Energy Economics and Finance
In this unit, we discuss some economic and finance concepts that are particularly
relevant to oil and gas industry.
Specifically, we will discuss concept of elasticity of demand, analyze energy firms
decision to supply oil a
What are Derivatives?
Definition: Security whose value derives from (depends on) values of other
In this unit, we will discuss three types of derivatives: options, forwards and futures.
Others not discussed here: swaps or compound de
Oil and Gas Industry
This is a complex, multi-trillion dollar industry that is traditionally classified as follows:
Upstream- This refers to exploration and production of oil and gas.
Midstream- This refers to transportation and processing of oil and g
Impact and Consequences of Using Fossil Fuels
In this unit, we will discuss how use of fossil fuels has changed modern human life
and how it in turn threatens continuation of current human lifestyle through
pollution and global warming.
Estimates of glo
History of Human Use of Energy
Prior to mass application of coal in mid-19th century in Western Europe and United
States, nearly all energy used was renewable in nature.
Such sources include (excluding human labor):
Unit 6 Outline
Human population explosion
1. Global population was estimated to be as low as 1 to 10 million in 10,000 BCE.
2. Development of agriculture allowed global population to spike to 150 to 300
million by 0 CE.
3. But global population essenti
Unit 4 Outline
1. This is a concept that quantifies how supply and demand change when price of a
2. It is defined as percentage change of supply or demand divided by percentage
change of price of a good.
3. When this ratio is gr
Unit 2 Outline
How are oil and gas formed?
1. Anaerobic oxidation of ancient water living organisms
2. Heat and pressure combined with microbial action turn ancient organic material
3. Kerogen undergoes catagenesis to become either crude o
Unit 3 Outline
Financing of oil and gas projects
1. Largest oil and gas firms use traditional corporate finance model and issue bonds
and equity at corporate level to raise capital needed for projects
2. But high project investment and risk make it nec
Unit 1 Outline
What is oil and gas economics and finance?
1. Topics to be covered in the course include:
Source of oil and gas,
Production and transformation of oil and gas into consumer products,
Organization of oil and gas industry and the way it is