Fuel Hedging Checklist

  1. Hedging Policy:  Do you have a written hedging policy with clearly defined goals and constraints to ensure your strategy will work?
  2. Hedging Tools:  Have you evaluated all of the hedging tools available to you?  What are they and how do you use them effectively?
  3. Basis Risk: Fuel hedging has particular basis risk that needs to be monitored versus  hedging tools chosen.  Are you watching your basis risk?
  4. Trading and Execution:  Are you using the lowest cost hedging execution strategies
  5. Counterparties and Exchanges: There is a wide variety of hedging counterparties and exchanges.  Have you review who and what is best for you?

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