Editor's letter

H The commodities trading landscape has changed dramatically in the past couple of years, largely due to the spread of electronic trade. This has allowed new players to enter the energy markets and has also dovetailed with other technologies - such as trade capture and confirmation systems, multi-commodity trading systems and complex algorithmic trading systems - to advance trading as a whole.

Our special report on technology looks at some of these developments, starting with one of the newest to enter energy trading and risk management - grid computing. With increasingly complex energy trading structures now more common, traders and risk managers need faster ways to quantify the risks involved in the many moving parts of these deals. Grid computing offers a way of solving massive computational problems by harnessing all of a business's available computational power. Its use in the energy risk management space is embryonic. RWE and Gaselys are two of the earliest firms to take it up.

Also included in our Special Report is the much sought-after Energy Risk Software Directory, which lists around 90 companies providing risk management and trading software solutions.

While technology has allowed rapid changes in some areas of the energy markets, elsewhere progress has been slower. In our July issue last year, our lead news story was about the Dubai Mercantile Exchange's (DME's) upcoming launch at the end of 2006. In fact it only began trading last month, 11 days after IntercontinentalExchange launched a rival sour crude contract to go head-to-head with the DME's Oman crude futures contract. Our news story on page 6 looks at the battle so far for the anticipated prize awaiting the creator of a Middle East benchmark contract. 

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