PSIA, Master in International Energy
Pedagogical format : Seminar Course validation : 50% Midterm and 50% Final Exam (both exams are take home and conducted during a pre-selected 24 hour period). Midterm is scheduled for after the 6th class lecture. Final exam is scheduled after the last lecture or during the ﬁnal exam time period as agreed upon between the class participants and professor. Course Description : The lectures on the oil markets are aimed to explore the current issues concerning the interaction between physical and ﬁnancial layers of the oil market and to analyse the implications of ﬁnancialization of oil markets on oil price behaviour. One objective is to describe the evolution of the international oil pricing system and to assess its main features. Another objective is to explain the basic mechanics of ﬁnancial instruments and how these instruments can be used for hedging purposes and price discovery in the oil market. The module is designed to be accessible both to those with little prior knowledge of ﬁnance issues/risk management principles. By the end of the module students would have learned to : Assess the main features of the current international oil pricing system and the process of price formation in oil markets ; Analyse the interaction between the physical and ﬁnancial layers of the oil market ; Introduce the main ﬁnancial instruments used in the oil markets and how these could be used for hedging purposes ; Derive the oil forward curve and assess the importance of ﬁnancial layers in the price discovery function ; Assess the role of ﬁnancial players and ﬁnancial layers and their impact on oil price movements. Required reading : Fattouh, B. (2011), ‘An Anatomy of the Crude Oil Pricing System', OIES WPM 40, Oxford : Oxford Institute for Energy Studies. http ://www.oxfordenergy.org/wpcms/ wp-content/uploads/2011/03/WPM40-AnAnatomyoftheCrudeOilPricingSystem-BassamFattouh-2011.pdf ; Fattouh, B. and L. Mahadeva (2012), Finacialization in Oil Markets : Lessons for Policy, Oxford Energy Comment, December. http ://www.oxfordenergy.org/wpcms/wp-content/ uploads/2012/12/Financialization-in-oil-markets.
pdf ; Fattouh, B. L. Kilian and L. Mahadeva (2013), The Role of Speculation in Oil Markets : What Have We Learned So Far ?, The Energy Journal, Vol. 34, No.3. http ://www.oxfordenergy. org/wpcms/wp-content/uploads/2012/08/WPM45.pdf ; Fattouh, B. and L. Mahadeva (2013), ‘OPEC : What Difference has it Made ?' Annual Review of Resource Economics, Forthcoming. http ://www.oxfordenergy.org/wpcms/wp-content/ uploads/2013/01/MEP-3.pdf.
Semester : Spring Number of hours : 24 Language of tuition : English
Teachers : Christian EGENHOFER (Chercheur). Pedagogical format : Seminar Course validation : Students are expected to attend all classes and to prepare each class by reading one article of around 10 pages. The assignment consists of a) participation in a simulation exercise (in the style of talk show) plus speaking notes and a 2-3 page paper after the simulation to be prepared by each student and b) and end of term paper in the form of a memorandum to the CEO or Minister of around 2,000 to 3,000 words. - Performance in the simulation : 10% ; - 2-3-page paper following the simulation : 20% ; - End of term paper : 70%. Workload : Class attendance ; - 30-minute reading in preparation for each class ; - Preparation of simulation (talk show) ; - End-of-term paper (of between 2,000 to 3,000 words). Pedagogical method : Lecture and discussion ; - Case studies discussed in class ; - Simulations (talk show) ; - Quiz (to recapitulate). Course Description : This course focuses on energy policy, which is described as the choices that governments make to address energy policy objectives, notably in the realm of supply, distribution or demand with the aim of ensuring 'security of supply' (importers) or security of demand 1453