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Hedging

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Hedging

In this constantly changing market, shipowners and charterers need to manage their risk on fuel purchases to remain on a level playing field with the competition. Fuel hedging, or fuel risk management, is a strategy to reduce or eliminate vulnerability to volatile and potentially rising fuel prices.

OLEO provides customized risk management strategies to hedge our customer’s exposure against market volatilities. We provide bespoke Fixed Price Agreements (FPA) structures to protect our customers from volatile market environments affecting bunker prices.

Our Hedging Solutions are as follows:

  • Fixed Forward Pricing, which can also be offered with port optionality.
  • Floating Pricing based on a Platts index. This can also be offered with port optionality.
  • Floating pricing with a Floor – the client accepts a put option in return for a heavy discount against the Platts index.
  • Flexible Mechanisms – date of nomination, date of delivery or average of the month.

*Products are offered subject to credit approval and may be subject to a margin threshold.