Nou work for a company who is an oil producer (that is, you stick pipes in the ground pulling oil out and selling your barrels of oil to refineries) Today is Nov 5, 2020 and spot the spot oil price is $53.00 per barrel. Today, the forward pricing curve is as follows: For Settlement: Jan 31, 2021 $51.00 Feb 28, 2021 $50.75 Mar 31, 2021 Apr 30, 2021 $49.85 $49.00 May 31, 2021 $48.35 Jun 30, 2021 $47.85 Oil Calls Prices: (same expiration and same strike prices as above) per 1000 barrels of oil $500 $600 $700 $800 $900 $950 Oil Put Prices $350 $375 $425 $500 $550 $575 Your oil production is forecasted as the following: Jan 2021 3000 barrels Feb 2021 4000 barrels Mar 2021 4000 barrels Apr 2021 3000 barrels May 2021 2000 barrels Jun 2021 4000 barrels Oil Calls Prices: $500 (same expiration and same strike prices as above) per 1000 barrels of oil $600 $700 $800 $900 $950 Oil Put Prices: $350 $375 $425 $500 $550 $575 Your oil production is forecasted as the following: Jan 2021 Feb 2021 Mar 2021 3000 barrels 4000 barrels 4000 barrels Apr 2021 3000 barrels May 2021 2000 barrels Jun 2021 4000 barrels The following are the market end of day prices for a barrel of oil for each of the following dates above: $62.00 $53.00 $42.00 $59.00 $67.00 $38.00 1. Calculate the net dollar at settlement for each month based on the settlement prices above assuming months Jan, Feb, and Mar were floating for fixed swaps. 2. And Apr, May, and Jun were vanilla/premium paid options. Nou work for a company who is an oil producer (that is, you stick pipes in the ground pulling oil out and selling your barrels of oil to refineries) Today is Nov 5, 2020 and spot the spot oil price is $53.00 per barrel. Today, the forward pricing curve is as follows: For Settlement: Jan 31, 2021 $51.00 Feb 28, 2021 $50.75 Mar 31, 2021 Apr 30, 2021 $49.85 $49.00 May 31, 2021 $48.35 Jun 30, 2021 $47.85 Oil Calls Prices: (same expiration and same strike prices as above) per 1000 barrels of oil $500 $600 $700 $800 $900 $950 Oil Put Prices $350 $375 $425 $500 $550 $575 Your oil production is forecasted as the following: Jan 2021 3000 barrels Feb 2021 4000 barrels Mar 2021 4000 barrels Apr 2021 3000 barrels May 2021 2000 barrels Jun 2021 4000 barrels Oil Calls Prices: $500 (same expiration and same strike prices as above) per 1000 barrels of oil $600 $700 $800 $900 $950 Oil Put Prices: $350 $375 $425 $500 $550 $575 Your oil production is forecasted as the following: Jan 2021 Feb 2021 Mar 2021 3000 barrels 4000 barrels 4000 barrels Apr 2021 3000 barrels May 2021 2000 barrels Jun 2021 4000 barrels The following are the market end of day prices for a barrel of oil for each of the following dates above: $62.00 $53.00 $42.00 $59.00 $67.00 $38.00 1. Calculate the net dollar at settlement for each month based on the settlement prices above assuming months Jan, Feb, and Mar were floating for fixed swaps. 2. And Apr, May, and Jun were vanilla/premium paid options
