EBF 301
Global Finance for the Earth, Energy, and Materials Industries

Lesson 3 Activities

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Pricing Activity

The NYMEX is actually owned by the Chicago Mercantile Exchange (CME Group). Visit the NYMEX website. Choose two energy commodity futures contracts being traded in the NYMEX and report the following:

  • Futures contract specifications
  • Definition of column headers
  • Screenshot of the front (prior) month futures prices
  • Report the "Last," "Change," and "Prior" prices, and also report the volumes for the front month contracts.

The answers should be uploaded to the L3 Activity dropbox in Canvas as a word document or PDF.

Grading Criteria

This activity is due at 11:59 pm on Sunday and is worth up to 20 points on the EBF 301 grading scale.


Fundamental Factors Activity

Part of the overall objective of this course is to have you understand how the market functions in terms of determining price and how it trades in general. To truly appreciate this, you have to begin to think like an energy commodities Trader. To do so, you must consider the market factors that they research before making any Buy/Sell decisions.

In Lesson 2, you were presented with a number of “fundamental” factors that can influence the price of crude oil and/or natural gas.

Beginning this week and continuing until further notice, you will submit Fundamental Factors assignments in the respective Lesson in Canvas each week by 11:59 p.m., Eastern US Time, on Sundays. Instructions for the Fundamental Factors assignments can be found under the "Resources" section of this website.

Links to their energy commodity prices (Henry Hub Natural Gas Futures and Light Sweet Crude Oil (WTI)) can be found in the course "Resources" menu on this website and the Lesson 3 Module of Canvas.

You are to submit ALL of the same fundamental factors for both crude and natural gas shown in Lesson 2 and give your opinion on how they impact prices for oil and natural gas. Fundamental Factors assignments should be submitted to the Fundamental Factors Dropbox on Canvas for each week.

Grading Criteria

A detailed grading rubric for the Fundamental Factors activities is available at the bottom of the instructions.

An example of a complete answer would be:

Natural Gas

The Energy Information Agency’s Weekly Natural Gas Storage Report (http://ir.eia.gov/ngs/ngs.html) showed an injection of +50 Bcf. This was below the expectation of +60 Bcf, therefore, it was seen as “bullish” since less supply was put into storage implying that demand was higher than expected. Prices would increase under this scenario. Total gas in storage now stands at 1.5 Tcf which is below the 5-year average as well as, last year at this time.


Quiz

Return to Canvas to complete the L3 Quiz.

Submitting Your Work

Pricing Activity: Submit your findings as a single word document or PDF to the L3 Activity Dropbox in Canvas.

Fundamental Factors: Submit your work as a single word document or PDF to the Lesson 3 Fundamental Factors Dropbox in Canvas.

Quiz: Take the quiz in Canvas