This category contains 9 posts

Ofgem open letter – the anti abuse focus continues

Ofgem, Great Britain’s National Regulatory Authority (NRA) yesterday issued this open letter to the market on the topic of “scarcity pricing” and conduct. It reminds market participants that generation must be priced economically both under REMIT and also the Balancing and Settlement Code. This letter represents  the latest anti abuse activity in the energy sector, … Continue reading

Post on wash trades

See here for an informative post about wash trades, by Gordon Allott of Broadpeak Partners. A wash trade is defined in ACER’s REMIT guidance as: The practice of entering into arrangements for the sale or purchase of a wholesale energy product where there is no change in beneficial interests or market risk, or where the transfer of … Continue reading

Welcome to 2015

For many, today is the first working day of 2015. In our world of commodity and energy trading regulation, we are likely to have a busy year. Here we will focus on what could hit us in Europe: REMIT This will undoubtedly be the year of REMIT on the gas and power side, especially in … Continue reading

The potential regulation of commodity benchmarks

See this interesting story on Bloomberg about regulation that may soon apply to the calculation of benchmarks in the commodities area. The article looks at how this may, or may not, work, given the intricacies of the commodities markets.

Big fines for market manipulation – Should we panic now?

Last week saw the FCA fining 5 banks £1.1bn for the manipulation of indices covering the FX market. Once again, regulators are showing that they will not tolerate market abuse, and are making well known the fact that they mean business in their efforts to clean up the market. The energy and commodities industry is … Continue reading

ISDA response to MAR consultation – interesting comments on interaction with REMIT

See here for ISDA’s response to the consultation(here and here) on the upcoming Market Abuse Regulation, also known as “MAD II”. It is the latest set of rules that will apply to financial instruments  in order to reduce market abuse. Since MAR applies to financial instruments, the question of whether a commodities trade is in fact … Continue reading

Benchmark manipulation – how will the rules apply?

See here for an interesting article from Reed Smith about the different rule making taking place around the world regarding benchmark manipulation. In particular it suggests that while benchmarks are not explicitly mentioned in REMIT (unlike MAR), they are never the less clearly targeted. This means that one needs to be careful that no one in … Continue reading

Responses to MAR consultations published

ESMA have published the responses to the consultation held recently on the forthcoming Market Abuse Regulation (MAR). This regulation extends the original Market Abuse Directive (MAD), and generally applies to financial trading. It will also apply to emissions and to some commodity spot trades. There is an interaction with REMIT, that generally applies to energy … Continue reading

Trade surveillance – an interesting article from the FX side

See this interesting article  in LeapRate on the current and future approaches that the FCA are taking to trade surveillance. With the advent of REMIT and also MAD II/MAR we will soon see this type of activity being carried out in the energy trading industry as well. The topic of whether one should run an … Continue reading