RE:The Big Picture Is this further to your message the other day about the future monthly contract price ?
I don't know how that base hedging. But I would imagine it must be tied to these numbers or have some correlation ? I also would guess that the firms providing the hedged make there own pricing ? These would then be the market to guide them.
Apologize for my ignorance. I get what hedging is of course. However the mechanics of how a firm does it.
Like who sells hedging ? Trafigaura ? Or ?
If you or anyone could do a break down ( teach me and others I am sure ). Break it down step by step. Like this maybe
1)oil has risen of late and the company decides it wants to consider hedging . ( let's not use the one Surge had To use , the bank is making us hedge all our production , or they are calling the loans ? True story )
2) they look to what market or company.
if someone is feeling like giving back to the less knowing
Much appreciated
Craig