At the risk of overusing the word of the year, 2020 has been unprecedented. As election results rolled in the evening of Nov. 3rd, the markets began to move – literally. Will Americans’ decision for the next President of the United States bring headwinds or tailwinds to energy markets around the world?
With traders and risk analysts monitoring hundreds of thousands of data points throughout the trade day, one needs a solution that simultaneously takes in hundreds of energy market and customer data sources, applies rigorous rules, and organizes the intelligence in such a way that it can be properly used by trading organizations to settle their positions and know their risks, acting as a key “fact checker” for commodity trading groups.
Along those lines, there is a lot of talk today about building an ‘intelligent data enterprise’ that provides visibility, efficiency and the information advantage to become a mega profit producing enterprise. This would enable trading organizations to be nimble, quickly exploit new opportunities, and beat the competition, especially in volatile times like elections.
Here are three ways to help traders drive profitability:
- Finding value in every molecule that moves through the supply chain.
Commodity trading margins are in decline, the market continues to be unpredictable, and increased competition is uncontrollable. Therefore, proprietary intelligence via predictive analytics is beginning to thrive throughout trading organizations.
The more data the better, right? So that traders can maximize and exploit every opportunity that is laid before them, whether supply chain issues, natural disasters that halt production, refinery outages, or energy efficiency/renewables, a system needs to be developed to manage this never-ending list.
MarketView Desktop is a predictive analytics tool that’s easy to use and has a plethora of market data, client proprietary data and Enverus fundamental data that provides the variables for traders to visualize trends and make decisions that turn into profits for their organization. MarketView includes predictive analytics that visualize price curves calculated for the customer in other Enverus solutions.
- Control resources by leveraging the public cloud.
Companies collect millions of terabytes of data daily. Building an intelligent foundation to move data out of silos and into usable formats leveraging cloud native technology is a must.
Establishing a data framework with data governance, flexibility, scalability, and security is a requirement for every trading organization. Companies must continually innovate or have a technology innovation partner to ensure they stay on the cutting edge of visualizing and executing on trade opportunities.
CurveBuilder allows traders to make split-second decisions on trade execution. The forward curve data (a form of predictive analytics focused on price) is also a visually appealing framework.
- Don’t get left behind the energy evolution.
Companies and governments around the globe are challenged to deliver more energy while reducing emissions and becoming more sustainable. Investing in environmentally friendly products such as hydrogen or biofuels is extremely fashionable to support battery storage, electric vehicles or wind farms. As demand surges for cleaner fuels and investors embrace low-carbon projects, commodity traders will adapt to new market changes, much like governments, politicians and oil companies.
Comprehensive renewable power market analytics tools are quickly moving ahead with expanding product offerings to include greenhouse gas (GHG) and Environmental Social and Governance (ESG) analytics for traditional oil and gas companies and investors that are taking the plunge into the new world order of renewable-focused energy. Investors and traders can also continue to track opportunities in oil and gas markets with sophisticated analytics data for production forecasting and pipeline flow monitoring.
Energy trading risk and market volatility derived from the U.S. Presidential election are best managed with verified, accurate news and data management. But why stop after the elections do? At the end of the day, traders know that energy commodities have the largest impact to everyday human lives. Whether you are driving a car, running electricity in your house, or eating dinner with your family, the world needs a healthy mix of renewable and non-renewable resources to support the global supply chain of human activities. That’s why now, more than ever, traders must make sense of the madness to drive trading profits.
Wendi Orlando is Vice President of Product Management at Enverus Trading & Risk
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