Other
Energy and Finance - Lecture notes week 1&2
- Course
- Institution
Lecture Notes for the Course Energy and Finance. Only Week 1 and 2!
[Show more]
Seller
Follow
xrolinda
Reviews received
Content preview
Energy & Finance – Lecture Notes Week 1 and 2Lecture notes Week 1
Gas market (3 regional markets USA, Europe and Asia)
- Supply; available capacity, flexibility to react, marginal costs, competition, policy measures
(subsidies + taxes)
- Demand; price sensitivity of consumers, income, external factors (temperature), policy
measures (subsidies + taxes)
Availability of gas to market depends on transports costs
- Pipelines
o High CAPEX (capital expenditure)
o OPEX increase with distance
o Most efficient for long distance
- LNG (Liquefied Natural Gas)
o Higher CAPEX, but lower OPEX
o Investments needed
o Most efficient for short distance
Increased LNG capacity and lower cost result in strong global intergarion.
Cost drive is price of oil as expected revenues from oil production affect the availability equipment for
gas production. Price differences due to political risks and inefficient allocation of capacity. In the
past no gas market; directly linked to oil price in EU.
Storage; flexibility
- Gas demand is highly volatile (temperature related)
- High fixed cost of pipelines
- Political risk; to reduce import dependency
Benefits of storage
- Balancing the gas system
- Intertemporal arbitrage of price differences
- Security of supply
- Stabilizes the gas price, expected prices depend on relative storage levels.
NL has hardly any storages, because Groningen gas field can as swing supplier.
Resource policies may affect (costs of) available supply.
Oil Market
Available resources are still abundant (scarcity).
Supply depends on reserves, opportunity costs and market power effects.
Global market but different prices exists due to quality (WTI, BRENT and OPEC benchmarks)
Demand for oil is still increasing (transport sector)
Market power of OPEC is not constant
- Call on OPEC versus actual production
- Non-conventional oil resources limit the market power
Short-term flexibility is modest
- Increasing production by non-OPEC countries takes time
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller xrolinda. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $3.35. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
85443 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now