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Gamma
The sensitivity of an option’s delta to changes in
the price of the underlying futures contract.
GasOil
European designation for No. 2 heating oil and
diesel fuel.
Gasoline, Straight-Run
Also known as raw gasoline. Gasoline which is
obtained directly from crude oil by fractional distillation.
Straight-run gasoline generally must be upgraded to
meet current motor fuel specifications.
Gathering
The collection of hydrocarbons, such as natural
gas or crude oil, from wellheads via pipeline or truck.
GCC
Gulf Cooperation Council
Generation
The process of producing electric energy by
transforming other forms of energy. The amount of
energy produced is expressed in watthours.
Good 'TIL Cancelled
An order to be held by a broker until it can be
filled or until canceled.
Gulf Cooperation Council
A regional organization made up of the six Persian Gulf Arab States. Created May 25, 1981, the Council is comprised of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.
Heating Oil
No. 2 fuel oil, a distillate fuel oil used either for
domestic heating or in moderate capacity commercial industrial
burners.
Heavy Crude
Crude oil with a high specific gravity and a low
API gravity due to the presence of a high proportion of
heavy hydrocarbon fractions.
Hedge
The initiation of a position in a futures or options
market that is intended as a temporary substitute for the
sale or purchase of the actual commodity. For example:
the sale of futures contracts in anticipation of future sales
of cash commodities as a protection against possible
price declines, or the purchase of futures
contracts in anticipation of future purchases of cash
commodities as a protection against the possibility of
increasing costs.
Hedger
A trader who enters the market with the
specific intent of protecting an existing or anticipated
physical market exposure from unexpected or adverse
price fluctuations.
Hedge Ratio
Ratio of the value of futures contracts purchased
or sold to the value of the cash commodity being
hedged, a computation necessary to minimize basis risk.
Historical Violatility
The annualized standard deviation of percent
changes in futures prices over a specific period. It is an
indication of past volatility in the marketplace.
Horizontal Spread
Calendar or time spread.
Hydrocarbons
Organic chemical compounds containing hydrogen
and carbon atoms. They form the basis of all petroleum
products.
Immediate-Or-Cancel
An order which must be filled immediately or be
canceled. IOC orders need not be filled in their entirety.
Implied Volatility
A measurement of the market’s expected price
range of the underlying commodity futures based on
market-traded options premiums.
In-The-Money
An options contract that can be exercised and
immediately closed out against the underlying market for
a cash credit. The option is in-the-money if the underlying
futures price is above a call option’s strike price, or
below a put option’s strike price.
Independent
Term generally applies to a non-integrated oil or
natural gas company, usually active in only one or two
sectors of the industry. An independent marketer buys
petroleum products from major or independent refiners
and resells them under his own brand name or buys natural
gas from producers and resells it. There are also
independents which are active exclusively either in oil or
gas production or refining.
Intregation
A term that describes the degree in, and to, which
one given company participates in all phases of the
petroleum industry.
Intrinsic Value
The amount by which an option is in-the-money.
An option which is not in-the-money has no intrinsic
value. For calls, intrinsic value equals the difference
between the underlying futures price and the option’s
strike price. For puts, intrinsic value equals the option’s
strike price minus the underlying futures price. Intrinsic
value is never less than zero.
Introducing Broker
A firm engaged in soliciting or in accepting orders
for the purchase or sale of any commodity for future
delivery, but does not accept money, securities or property
to margin, guarantee, or secure trades or contracts.
Inverted Market
A futures market is said to be inverted when distant
contract months are selling at a discount to nearby
contract months; also known as backwardation.
Jet Fuel
Kerosene-type; high-quality kerosene product
used primarily as fuel for commercial turbojet and turboprop
aircraft engines.
Jobber
A middleman. A gasoline jobber, for example,
might buy from refiners and would resell to small distributors
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