introduction to energy futures - futures and options ... to energy futures. ... for persons who can...

Introduction toEnergy Futures

ENERGY PRODUCTS ARE FOUND IN MANY AREAS OF

MODERN LIFE, FROM THE FUEL IN YOUR GAS TANK

TO THE HEAT IN YOUR HOME. CRUDE OIL IS EVEN

USED IN THE MANUFACTURE OF CERTAIN TYPES OF

PLASTICS WHICH HAVE A VAST AMOUNT OF USES.

WTI Crude Oil Futures

By understanding the fundamentals of the energy markets, traders, producers and investors can leverage better methods of price discovery and risk management.

While there are several energy futures products, some of the most popular and widely traded are:

Natural Gas Futures

RBOB Gasoline Futures

02 Rosenthal Collins Group, LLC

An investment in futures contracts involves a high degree of risk and is suitable only for persons who can assume the risk of loss in excess of their margin deposits. You should carefully consider whether futures trading is appropriate for you in light of your investment experience, trading objectives, financial resources, and other relevant circumstances. Past performance is not necessarily indicative of future results.

ENERGY FUTURES


CRUDE OIL FUTURESWTI Crude Oil: An Overview

West Texas Intermediate (WTI), is sometimes referred to as Texas light sweet and is considered the benchmark for crude oil pricing. This type of crude oil is lighter than Brent crude, and features a lower sulfur content and relatively low density. [Source: Wikipedia]

As of 2015, the U.S. reportedly consumed about 19.4 million barrels per day according to the U.S. Energy Information Administration

A barrel of crude oil can be refined into many other products.

These products include:

Crude Oil Use

The world’s top producers of crude oil include the United States, Saudi Arabia, Russia, China, Iraq and others.

Crude oil is used to make various other fuels and products, and as energy consumption increases, demand for crude oil may continue to rise.

Crude oil is one of the most widely used and traded commodities on the planet.

GasolineAsphaltDiesel Fuel

Jet FuelLubricants

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Diesel and other fuel

Jet Fuel

Other products

Gasoline

Uses of Petroleum

There are many ways to gain exposure to crude oil including energy company stocks, ETFs, futures and more. A raw commodity like crude oil may appeal to investors for many reasons, including the potential to act as an inflationary hedge or for the possibilityof price appreciation.

Investing in Crude Oil

46%

26%

11%

9%

3%4%

1%

Heavy fuel oil

Asphalt

Lubricants

Source: U.S. Energy Information Administration http://www.eia.doe.gov

https://www.eia.gov/tools/faqs/faq.cfm?id=33&t=6

https://www.eia.gov/tools/faqs/faq.cfm?id=33&t=6


As one of the most widely watched and traded commodities on earth, crude oil may exhibit periods of relative quiet and periods of heightened volatility. There are numerous issues that can potentially impact crude oil prices including:

General FactorsInfluencing Price

Supply disruptions

Economic demand

The Value of the U.S. Dollar

Geopolitical tensions

Government regulations

Storage costs

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CRUDE OIL FUTURES

Source: U.S. Energy Information Administration https://www.eia.gov/petroleum/weekly/images/gtpsusm.gif


CRUDE OIL FUTURES

Crude oil may be affected by other outside markets such as equity markets or interest rates. For example, weaker stocks may dampen risk appetite and demand for crude oil, while higher interest rates may drive a stronger dollar and emerging market volatility.

Other FactorsInfluencing Price


CRUDE OIL FUTURES

U.S. Crude Oil Supply & DispositionAnnual Supply(Thousand Barrels)

2010 2011 2012 2013 2014 2015

Supply

Field Production (Commercial) 1,998,554 2,058,916 2,372,312 2,715,220 3,178,306 3,442,208

Alaskan 218,904 204,829 192,368 187,954 181,175 176,240

Lower 48 States 1,779,650 1,854,087 2,179,943 2,527,266 2,997,131 3,265,968

Imports 3,362,856 3,261,422 3,120,755 2,821,480 2,680,626 2,682,946

Commercial 3,362,856 3,261,422 3,120,755 2,821,480 2,680,626 2,682,946

Strategic Petroleum Reserve (SPR)

Adjustments (Commercial) 36,033 69,129 57,474 87,981 85,206 49,450

Disposition

Stock Change 8,180 -33,345 34,134 -7,732 31,268 91,814

Commercial 8,251 -2,751 34,817 -8,433 36,278 87,654


Refinery Net Inputs 5,374,094 5,404,347 5,489,516 5,589,006 5,784,637 5,915,532

Exports 15,198 17,158 24,693 48,968 128,233 167,258

Products Supplied -29 1,308 2,198 -5,562 0 0

Ending Stocks

Total 1,059,975 1,026,630 1,060,764 1,053,032 1,084,300 1,176,487

Commercial 333,430 330,679 365,496 357,063 393,341 481,368

Refinery 88,982 90,640 88,781 85,114 95,794 100,805

Tank Farms and Pipelines 218,783 214,430 242,665 238,499 261,120 344,079

Cushing, OK 38,089 29,252 49,903 41,426 31,944 63,507

Lease 21,348 22,458 27,700 29,872 32,476 32,103

Alaskan Crude Oil In- Transit by Water

4,317 3,151 6,350 3,578 3,951 4,381


726,545 695,951 695,268 695,969 690,959 695,119

SPR Stocks

Percent of Crude Oil Stocks 68.5 67.8 65.5 66.1 63.7 59.1

Percent of Total Petroleum Stocks 40.5 39.8 38.5 39.5 37.2 34.5

Days of Petroleum Net Imports 77 82 94 112 136 149

Notes: Adjustments include an adjustment for crude oil, previously referred to as "Unaccounted For Crude Oil". A negative stock change indicates a decrease in stocks and a positive number indicates an increase in stocks. Totals may not equal sumof components due to independent rounding. Crude oil stocks include an adjustment of 10,630 thousand barrels (constant since 1983) to account for incomplete survey reporting of stocks held on producing leases. See Definitions, Sources, and Notes link above for more information on this table.

Release Date: 7/29/16Source: U.S. Energy Information Administration


1,000 barrelsContract Unit

U.S. Dollars and Cents per barrelPrice Quotation

CME Globex:

Sunday - Friday 6:00 p.m. - 5:00 p.m. (5:00 p.m. - 4:00 p.m. Chicago Time/CT) with a 60-

minute break each day beginning at 5:00 p.m. (4:00 p.m. CT)

Trading Hours

$0.01 per barrelMinimum Price Fluctuation

Product Code CME Globex: CL

CME ClearPort: CL

Clearing: CL

TAS: CLT

TAM: CLS

CRUDE OIL FUTURES

CME ClearPort:

Sunday - Friday 6:00 p.m. - 5:00 p.m. (5:00 p.m. - 4:00 p.m. Chicago Time/CT) with a 60-

minute break each day beginning at 5:00 p.m. (4:00 p.m. CT)

Crude oil futures are listed nine years forward using the following listing schedule: consecutive months are listed for the

current year and the next five years; in addition, the June and December contract months are listed beyond the sixth

year. Additional months will be added on an annual basis after the December contract expires, so that an additional

June and December contract would be added nine years forward, and the consecutive months in the sixth calendar year

will be filled in.

Additionally, trading can be executed at an average differential to the previous day’s settlement prices for periods of two

to 30 consecutive months in a single transaction. These calendar strips are executed during open outcry trading hours.

Listed Contracts

DeliverableSettlement Method

Trading in the current delivery month shall cease on the third business day prior to the twenty-fifth calendar day of the

month preceding the delivery month. If the twenty-fifth calendar day of the month is a non-business day, trading shall

cease on the third business day prior to the last business day preceding the twenty-fifth calendar day. In the event that the

official Exchange holiday schedule changes subsequent to the listing of a Crude Oil futures, the originally listed expiration

date shall remain in effect. In the event that the originally listed expiration day is declared a holiday, expiration will move to

the business day immediately prior.

Termination Of Trading

Contract SpecificationsCME GROUP

(chart continued on next page)

Crude Oil Futures Settlement ProceduresSettlement Procedures

NYMEX Position LimitsPosition Limits

NYMEX 200Exchange Rulebook

Block Minimum TresholdsBlock Minimum

NYMEX 200Price Limit or Circuit

Quote Vendor Symbols ListingVendor Codes

Delivery shall be made free-on-board (“F.O.B.”) at any pipeline or storage facility in Cushing, Oklahoma with pipeline access

to Enterprise, Cushing storage or Enbridge, Cushing storage. Delivery shall be made in accordance with all applicable

Federal executive orders and all applicable Federal, State and local laws and regulations.

At buyer’s option, delivery shall be made by any of the following methods: (1) by interfacility transfer (“pumpover”) into a

designated pipeline or storage facility with access to seller’s incoming pipeline or storage facility; (2) by in-line (or in-system)

transfer, or book-out of title to the buyer; or (3) if the seller agrees to such transfer and if the facility used by the seller

allows for such transfer, without physical movement of product, by in-tank transfer of title to the buyer.

Delivery Procedure

Source: CME Group: http://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude_contract_specifications.htmlas of 8/20/16

(A) Delivery shall take place no earlier than the first calendar day of the delivery month and no later than the last calendar

day of the delivery month.

(B) It is the short’s obligation to ensure that its crude oil receipts, including each specific foreign crude oil stream, if

applicable, are available to begin flowing ratably in Cushing, Oklahoma by the first day of the delivery month, in accord with

generally accepted pipeline scheduling practices.

(C) Transfer of title-The seller shall give the buyer pipeline ticket, any other quantitative certificates and all appropriate

documents upon receipt of payment.

The seller shall provide preliminary confirmation of title transfer at the time of delivery by telex or other appropriate form

of documentation.

Delivery Period

Please see rulebook chapter 200Grade And Quality

CRUDE OIL FUTURES


Trade At Marker Or Trade At Settlement Rules

Trading at settlement is available for spot (except on the last trading day), 2nd, 3rd and 4th months and subject to the

existing TAS rules. Trading in all TAS products will cease daily at 2:30 PM Eastern Time. The TAS products will trade off of

a “Base Price” of 0 to create a differential (plus or minus 10 ticks) versus settlement in the underlying product on a 1 to

1 basis. A trade done at the Base Price of 0 will correspond to a “traditional” TAS trade which will clear exactly at the final

settlement price of the day.

TAM trading is analogous to our existing Trading at Settlement (TAS) trading wherein parties will be permitted to trade at

a differential that represents a not-yet-known price. TAM trading will use a marker price, whereas TAS trading uses the

Exchange-determined settlement price for the applicable contract month. As with TAS trading, parties will be able to enter

TAM orders at the TAM price or at a differential between one and ten ticks higher or lower than the TAM price. Trading at

marker is available for spot month on the last trading day.

Light Sweet Crude Oil (CL) spot, 2nd and 3rd months and nearby/second month, second/third month and nearby/third

month calendar spreads



NATURAL GAS FUTURESNatural Gas: An Overview

First discovered in America in the early 1600s, natural gas is one of the cleanest and safest energy sources available today. William Hart dug the first natural gas well in 1821 in Fredonia, New York. This first well eventually led to the Fredonia Gas Light Company. [Source: APGA.org]

Natural gas is colorless and odorless in its pure form, although quite combustible. This powerful source of energy is composed primarily of methane, and may also contain various amounts of ethane, nitrogen, hydrogen sulfide, carbon dioxide and other gases. {Source: NaturalGas.org]

Natural gas is particularly useful due to the amount of energy that is released when combusted. This gas burns cleaner than other fossil fuels, and emits lower levels of potentially hazardous byproducts. With global energy needs on the rise, it is no wonder that natural gas is such an important natural resource. [Source: NaturalGas.org]

Natural gas powers many key components of everyday life.Among other things, this key energy source is used in:

Natural Gas Use

Natural gas is a major player in the global supply of energy.

Home heatingHot water heatingCooking stoves

OvensAutomobiles

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Investments in natural gas can be made in many ways, including stocks, ETFs, futures and more.

As energy consumption rises, investors may speculate on rising prices or use such investments to hedge exposure to volatility in natural gas prices. As a commodity, natural gas may also potentially offer a hedge against rising inflationary pressures or a declining dollar.

Investing in Natural Gas1997 1999 2001 2003 2005 2007 2009 2011

0

5

10

15

20

25

Historical usage of natural gas in the United States

Trill

ion

Cubi

c Fe

et o

f Nat

ural

Gas

Pipeline & Distribution

Electric Power

Industrial

Commercial

Residential



NATURAL GAS FUTURES

Although natural gas may at times exhibit a strong correlation to crude oil and other energy markets, it does have some unique characteristics that may drive price action. While there are numerous possible factors that could potentially influence prices, someof the most significant include:


Overall economic conditions

Energy policies

Current supplies

Weather

Supply disruptions

Refining capacity

Dollar strength or weakness

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While the above are some of the graphic primary catalysts for price movement in natural gas, the market may also be affected by other inputs. Some of these additional inputs include:

Storage costs

Transportation costs

Insurance and interest costs

Petroleum fuel prices

Import/export levels

Supplies in storage - “The overall supply picture is also influenced by the level of natural gas held in underground storage

fields. Storage helps to meet seasonal and sudden increases in demand, which otherwise may not be met by domestic

production and imports. When demand is lower, storage absorbs excess domestic production and possibly lower-cost

imports. Storage also supports pipeline operations and hub services. Levels of natural gas in storage typically increase

April through October, when demand for natural gas is lower, and decrease November through March, when demand

for natural gas for heating is generally high.”

[Source: U.S. Energy Information Administration]

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NATURAL GAS FUTURES


NATURAL GAS FUTURES

Natural Gas Gross Withdrawals and Production

Marketed Production - AnnualVolumes in Million Cubic Feet

2010 2011 2012 2013 2014 2015

U.S. 22,381,873 24,036,352 25,283,278 25,562,232 27,336,644 28,751,579

Alaska 374,226 356,225 351,259 338,182 345,331 343,430

Alaska Onshore 316,546 294,728 315,682 280,101 305,061

Alaska State Offshore 57,680 61,496 35,577 58,081 40,269

Arkansas 926,639 1,072,212 1,146,168 1,139,654 1,123,678 1,017,319

California 286,841 250,177 246,822 252,310 252,718 222,680

California Onshore 251,559 218,638 214,509 219,386 218,512

California State Offshore 5,120 4,760 5,051 5,470 5,961

Federal Offshore California 30,162 26,779 27,262 27,454 28,245

Colorado 1,578,379 1,637,576 1,709,376 1,604,860 1,631,390 1,671,787

Federal Offshore Gulf of Mexico 2,245,062 1,812,328 1,507,564 1,309,246 1,255,362 1,331,380

Federal Offshore Alabama

Federal Offshore Louisiana

Federal Offshore Texas

Kansas 324,720 309,124 296,299 292,467 286,080 292,450

Louisiana 2,210,099 3,029,206 2,955,437 2,360,202 1,980,287 1,932,407

Louisiana Onshore 2,140,525 2,958,249 2,882,193 2,282,452 1,918,626

Louisiana State Offshore 69,574 70,957 73,244 77,750 61,662

Montana 87,539 74,624 66,954 63,242 59,930 57,218

New Mexico 1,292,185 1,237,303 1,215,773 1,171,640 1,180,808 1,247,083

North Dakota 81,837 97,102 172,242 235,711 326,537 460,406

Ohio 78,122 78,858 84,482 166,017 518,767 1,014,848

Oklahoma 1,827,328 1,888,870 2,023,461 1,993,754 2,310,114 2,499,599

Pennsylvania 572,902 1,310,592 2,256,696 3,259,042 4,214,643 4,768,848

Texas 6,715,294 7,112,863 7,475,495 7,633,618 7,953,343 7,872,145

Texas Onshore 6,686,719 7,089,072 7,458,989 7,619, 582 7,942,121

Texas State Offshore 28,574 23,791 16,506 14,036 11,222

Utah 432,045 457,525 490,393 470,863 453,207 422,423

West Virginia 265,174 394,125 539,860 741,853 1,040,250 1,318,822

Wyoming 2,305,525 2,159,422 2,022,275 1,858,207 1,791,235 1,701,641



NATURAL GAS FUTURES

Other States

Other States Total 5,412,154 6,440,135 7,732,015 671,364 612,963 577,095

Alabama 222,932 195,581 215,710 196,326 181,054

Alabama Onshore 128,194 116,932 128,312 120,666 110,226

Alabama State Offshore 94,738 78,649 87,398 75,660 70,827

Arizona 183 168 117 72 106

Florida 12,409 15,125 773 292 369

Illinois 1,702 2,121 2,125 2,887 2,626

Indiana 6,802 9,075 8,814 7,938 6,616

Kentucky 135,118 124,243 106,122 94,665 78,737

Maryland 43 34 44 32 20

Michigan 131,118 138,162 129,333 123,622 114,946

Mississippi 73,721 81,487 63,843 59,272 54,440

Missouri NA NA NA 9 9

Nebraska 2,231 1,959 1,328 1,032 402

Nevada 4 3 4 3 3

New York 35,813 31,124 26,424 23,458 20,201

Oregon 1,407 1,344 770 770 950

South Dakota 1,862 1,848 15,085 16,205 15,307

Tennessee 5,144 4,851 5,825 5,400 5,294

Virginia 147,255 151,094 146,405 139,382 131,885

Notes: Beginning with monthly data for January 2006, "Other States" volumes include all of the natural gas producing states except: Alaska, Arkansas, California, Colorado, Kansas, Louisiana, Montana, New Mexico, North Dakota, Ohio, Oklahoma, Pennsylvania, Texas, Utah, West Virginia, Wyoming, and the Gulf of Mexico. Data for 2014 are estimated. Monthly preliminary (from January 2014 to present) state-level data for the production series, except marketed production, are not available until after the final annual reports for these series are collected and processed. Final annual data are generally available in the third quarter of the following year. For years prior to 2007, coalbed production data are included in Gas Well totals. For 2007-forward, gross production from coalbed methane and shale data are from PointLogic Energy. Prior to 1997, state production for Texas, Louisiana, and Alabama includes a portion of the Federal Offshore Gulf of Mexico production. Production for these states prior to 1997 excluding the Federal Offshore Gulf of Mexico can be found at the state energy datasystem (seds). See Definitions, Sources, and Notes link above for more information on this table.

Release Date: 07/29/2016



10,000 million British thermal units (mmBtu).Contract Unit

U.S. dollars and cents per mmBtu.Price Quotation

CME Globex: Sunday - Friday 6:00 p.m. - 5:00 p.m. (5:00 p.m. - 4:00 p.m. Chicago Time/CT)

with a 60-minute break each day beginning at 5:00 p.m. (4:00 p.m. CT)Trading Hours

NATURAL GAS FUTURES


CME ClearPort: Sunday - Friday 6:00 p.m. - 5:00 p.m. (5:00 p.m. - 4:00 p.m. Chicago Time/CT)

with a 60-minute break each day beginning at 5:00 p.m. (4:00 p.m. CT)

CME ClearPort

$0.001 per MMBtuMinimum Price Fluctuation

The current year plus the next twelve calendar years. A new calendar year will be added following the

termination of trading in the December contract of the current year.Listed Contracts


Trading of any delivery month shall cease three (3) business days prior to the first day of the delivery month. In the event that

the official Exchange holiday schedule changes subsequent to the listing of a Natural Gas futures, the originally listed expiration

date shall remain in effect. In the event that the originally listed expiration day is declared a holiday, expiration will move to the

business day immediately prior.


Product Code CME Globex: NG

CME ClearPort: NG

Clearing: NG

TAS: NGT

CME Globex

$0.001 per MMBtu

Inter-commodity spreads on Globex may also occur in multiples of $0.00025 per MMBtu

Trade At Marker Or TradeAt Settlement Rules

Trading at settlement is available for spot (except on the last trading day), 2nd, 3rd and 4th months and subject to the

existing TAS rules. Trading in all TAS products will cease daily at 2:30 PM Eastern Time. The TAS products will trade off of

a “Base Price” of 0 to create a differential (plus or minus 10 ticks) versus settlement in the underlying product on a 1 to

1 basis. A trade done at the Base Price of 0 will correspond to a “traditional” TAS trade which will clear exactly at the final

settlement price of the day.

Natural Gas Futures Settlement ProceduresSettlement Procedures



Block Minimum ThresholdsBlock Minimum

NYMEX 220Price Limit or Circuit


Natural Gas meeting the specifications set forth in the FERC-approved tariff of Sabine Pipe Line Company as then in effect

at the time of delivery shall be deliverable in satisfaction of futures contract delivery bligations.Grade And Quality

Source: CME Group: http://www.cmegroup.com/trading/agricultural/grain-and-oilseed/wheat_contract_specifications.htmlas of 8/20/16

Gasoline Consumption(Thousand Barrels per Day)


RBOB GASOLINE FUTURESRBOB Gasoline: An Overview

Gasoline is a big part of everyday life for many consumers, whose household budgets and personal spending can be significantly affected by changes in gasoline prices.

RBOB gasoline is the benchmark contract for gasoline trading and refers to a petroleum product known as “Reformulated gasoline blendstock for oxygen blending.” Prices for RBOB gasoline futures are quoted in U.S. Dollars per gallon and each contract represents 42,000 gallons of RBOB gasoline.[Source: Financialadvisory.com].

Gasoline prices are monitored closely by investors as rising energy costs can have a dramatic impact on personal spending and may affect the bottom line for companies dependent on this type of fuel.

While more and more automakers and engine makers are incorporating electrical power, gasoline remains the primary fuel for automobile and other various small combustion engines.

North America

Asia & Oceania

Europe

Middle East

Central & SouthAmerica

Eurasia

Africa

10,509.90

3,984.63

2,782.95

1,187.19

668.77

954.12

1,074.22


The primary use of RBOB gasoline is to fuel motor vehicles. In addition to autos, this fuelmay also be used in:

RBOB Gasoline Use

Lawn mowersGeneratorsBoatsOther engine types

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Like other petroleum products, RBOBgasoline may garner investment interest for speculative purposes as well as for hedgingpurposes. Gasoline can be traded or invested inusing a variety of different products including energy company stocks, ETFs and futures.

Investing in RBOB Gasoline


RBOB GASOLINE FUTURES


As a byproduct of crude oil, gasoline prices can be heavily affected by changes in crude Oil prices. While gasoline and oil often exhibit a strong, positive correlation, they may also at times exhibit a divergence in price. Some of the major factors that can affect gas prices include:


Transportation costs

Insurance costs

Price setting mechanisms

Dealer premiums

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Overall economic conditions

Weather

Refining capacity

Demand

Dollar strength or weakness

Geopolitical issues

Government regulation

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Cost Structure Of OneGallon Of Regular Grade Gas


The price of gasoline seen at the pump

Can also be affected by other issues including:

Federal, state and local excise and sales taxes including the federal and state gasoline tax

Credit card transaction fees

Gasoline transportation costs

Various retailer overhead costs

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There are numerous factors taken into consideration for the pricing of gasoline at the retail level. When you pull up to the pump to fill your car with gas, the quoted gasoline price represents not only the wholesale cost and any dealer profit margin but also:

7%12%

13%69%

Distribution and Marketing

Refining Costs and Profits

Federal and State Taxes

Cost of Crude Oil


42,000 gallonsContract Unit

U.S. dollars and cents per gallonPrice Quotation

CME Globex:

Sunday - Friday 6:00 p.m. - 5:00 p.m. (5:00 p.m. - 4:00 p.m. Chicago Time/CT)with a 60-minute break each day beginning at 5:00 p.m. (4:00 p.m. CT)

Trading Hours

$0.0001 per gallonMinimum Price Fluctuation

Monthly contracts listed for the current year and the next 3 calendar years +1 month. Monthly contracts for a new calendar year will be added following the termination of trading in the December contract of the current year.

Listed Contracts


Trading in a current delivery month shall cease on the last business day of the month preceding the delivery month.


Product Code CME Globex: RBCME ClearPort: RBClearing: RBTAS: RBT



Trading at settlement is available for spot (except on the last trading day), 2nd, 3rd and 4th months and subject to the existing TAS rules. Trading in all TAS products

Termination At Market Or

CME ClearPort:

Sunday - Friday 6:00 p.m. - 5:00 p.m. (5:00 p.m. - 4:00 p.m. Chicago Time/CT)with a 60-minute break each day beginning at 5:00 p.m. (4:00 p.m. CT)


RBOB Futures Settlement ProceduresSettlement Procedures



Block Minimum ThresholdsBlock Minimum

NYMEX 191Price Limit Or Circuit


Please see rulebook chapter 191Delivery Procedure

Source: CME Group - http://www.cmegroup.com/trading/energy/refined-products/rbob-gasoline_contract_specifications.htmlas of 8/20/16



will cease daily at 2:30 PM Eastern Time. The TAS products will trade off of a “Base Price” of 0 to create a differential (plus or minus 10 ticks) versus settlement in the underlying product on a 1 to 1 basis. A trade done at the Base Price of 0 will correspond to a “traditional” TAS trade which will clear exactly at the final settlement price of the day.

TAM trading is analogous to our existing Trading at Settlement (TAS) trading wherein parties will be permitted to trade at a differential that represents a not-yet-known price. TAM trading will use a marker price, whereas TAS trading uses the Exchange-determined settlement price for the applicable contract month. As with TAS trading, parties will be able to enter TAM orders at the TAM price or at a differential between one and ten ticks higher or lower than the TAM price. Trading at marker is available for spot month on the last trading day.

RBOB Gasoline (RB) spot, 2nd and 3rd months and nearby/second month, second/third month and nearby/third month calendar spreads.

Termination At Settlement Rules


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