Energy Hedging& Risk Management GlossaryA comprehensive source of information for anyoneinvolved in energy hedging and risk management.
2Accumulation-ers, who ‘accumulate’ the commodity they are trading.American Style Option-Ancillary ServicesAny service required by a system operator to deliverinclude balancing services, load following, or provid-APIArbitrageThe simultaneous purchase of a commodity/deriva-Asian Option (Average Price Option)Associated Gas (wet gas)Non-associated gas, or dry gas, is natural gas thatoccurs on its own.At-The-Money Option (ATM)the current price in the underlying marketBBackwardationA market where the price for nearby delivery is higherthan for further forward months. The opposite of back-BargeVessel carrying oil, usually on rivers, containing be-tween 8,000 and 50,000 bbl, or weighing 1,000 to10,000 tonnes. In the US, barges can be up to, andoccasionally over, 100,000 bbl in capacity.BarrelA volumetric unit of measure for crude oil and petro-leum products. 1 barrel is 42 US gallons.AEnergy Hedging& Risk Management GlossaryA comprehensive source of information for anyoneinvolved in energy hedging and risk management.
Energy Hedging & Risk Management Glossary3Base LoadThe minimum amount of electric power delivered orrequired over a given period of time at a steady rate.The minimum continuous load or demand in a powersystem over a given period of timeBase Load PlantA plant normally operated to take all or part of theminimum continuous load of a system, and whichconsequently produces electricity at an essentiallyconstant rate. A base load plant typically has relativelyhigh fixed costs and low unit operating costs. Tradi-tionally, nuclear plants have been considered as baseload plants.BasisThe difference between the price of a spot commod-ity and a forward commodity; the difference betweenthe price of a commodity at one location and anotherlocation.Basis SwapBasis swaps are used to hedge exposure to basis risks,such as locational risk or time exposure risk.BearishThe belief that the price is going to fall.BidAn indication of willingness to buy a specified amountof a commodity at a specific priceBlack-ScholesOptions pricing theory derived by Fisher Black andMyron Scholes, based on the theory that price volatil-ity is random around a given trend.British Thermal Unit (BTU)The quantity of heat required to raise one pound ofwater (about one pint) one degree Fahrenheit at ornear its point of maximum density. A common unit ofmeasurement for gas prices. 1034 Btus = 1 cubic foot.An MMBtu (-mil Btus) is roughly equivalent to a Mcf (athousand cubic feet).BullishThe belief that the price is going to rise.Burner-TipThe point at which natural gas is used as a fuel.CCall OptionAn option that gives the buyer (holder) the right butnot the obligation to buy a specified quantity of anunderlying futures contract at a fixed price, on orbefore a specified date. The grantor of the option isobliged to deliver the future at the fixed price if theholder exercises the optionCapacityThe power output rating of a generator, typically inmegawatts, measured on an instantaneous basis.Cash and CarryAn arbitrage transaction involving the simultaneouspurchase of a cash commodity with borrowed moneyand the sale of the appropriate futures contract.Cash MarketThe physical market underlying a futures or optionscontract.
Energy Hedging & Risk Management Glossary4Cash SettlementThe settlement of futures or options by paying acash difference, rather than taking/making physicaldelivery.ChannelLike it sounds a channel in which prices are moving.Parallel trend lines are drawn along the lows and highsof a price chart, forming a channel in which pricesmove. The trend lines form areas of support and resis-tance. Depending on the trend, the channel can be adown channel or an up channel.CIFCost, insurance and freight charges for shippingproducts.City-GatePhysical location where gas is delivered by a pipelineto a local distribution company.ClearingThe process of matching trades, settling trades andprovision of a guarantee for traded contracts, often aservice performed by exchangesClearing FeeA fee charged by a clearing house for clearing tradesClose OutFinalizing a transaction by making an equal andopposite trade to an open positionCNGCompressed natural gas, an automotive fuel.CogenerationThe production of both electricity and useful thermalenergyfromthesameenergysource.Naturalgastendsto be a favored fuel for combined-cycle cogenerationunits, in which waste heat is converted to electricity.Combination HedgingA risk management strategy that uses a combinationof hedges using different derivative instrumentsCombined CycleThe combination of one or more gas turbine and steamturbines in an electric generation plant. An electricgenerating technology in which electricity is producedfrom otherwise lost waste heat exiting from one ormore gas (combustion) turbines. The heat is routedto a conventional boiler or to a heat recovery steamgenerator for use by a steam turbine in the productionof electricity. This process increases the efficiency ofthe electric generating unitCombined Heat and Power (CHP)Power plant, usually embedded, which produces bothelectric and thermal energy in the form of steam.CongestionWhen prices trade at similar levels over a period oftime, the chart becomes cluttered with businessat these levels and is referred to as ‘congested’.Congestion areas are often seen as providing support/resistance. They are the levels at which, rather thanbreaking into new ground, prices tend to bog downand become trapped.ConsolidationPrices moving in a broadly sideways range after asharp move in one direction. If the prices have risensharply, the gains are ‘consolidated’, often for severaldays after the major move.
Energy Hedging & Risk Management Glossary5ContangoMarket situation where prices are higher for forwarddelivery dates than for nearer delivery dates. Oppositeof backwardation.ConwayConway, Kansas. The main propane trading hub in theMidwest United States.Covered OptionAn option written against an underlying positionCurve-lock SwapA swap which “locks” the counterparty into an existingprice relationship in the forward curve, with the aimof benefiting from any shifts in the forward curve e.g.between backwardation and contangoCushingCushing, Oklahoma. The delivery point for NYMEXWTI crude oil futures.Crack SpreadThe spread differential which represents refining mar-gins. For example, if crude oil is trading at $65/BBL andgasoline is trading at 2.25/gal then the crack spread is$29.50.DDegree DayDegree days are measured as the number of degreesabove or below a standardized temperature on anygiven day. In winter, traders track heating degreedays week by week, or month by month, normallyagainst a standard temperature of 65F, on the basis ofhow many degrees of heat are required to bring thetemperature up 65F. In summer, the market trackscooling degree days, which are computed in theopposite manner.DeltaThe rate of change of the value of an option withrespect to changes in the price of the underlyingcommodityDelta HedgingThe process whereby the grantor of an option decidesto buy or sell more or less of an underlying futurescontract in order to protect against being declaredupon by the options holder. If delta hedging, thegrantor of a call option will buy more of the futurescontract if it rises in value towards the strike price (asthe probability of being declared upon rises towards100%). The grantor of a put option will typically sellmore of the underlying futures contract if it slides invalue (as the probability of being declared upon risestowards 100%)Delta NeutralA state where the grantor of an option has balancedthe probability of being declared upon throughbuying/selling the underlying futures contract.Demand Side ManagementAll activities or programs undertaken by an electric-ity system or consumers to influence the amount andtiming of electricity use.DemurrageThe detention or delay of a vessel in loading or un-loading beyond the time agreed upon. Demurragecharges are usually incurred for any delay.
Energy Hedging & Risk Management Glossary6Differential-Dry GasNatural gas which does not contain liquid hydrocar-bons. Gas is usually priced on a dry basis.EEIAEFPExchange of futures for physical: refers to the exchangeElliott Wavethree- wave trend, the extent and scope of which areEuropean Optionexpiry. These typically trade in the OTC markets.Exchange-Tradedsuch as NYMEX or ICE, with standard contracts andrulesExerciserights to the contract and is delivered a long (call) orprice.Differential SwapDouble-up Swapto double the swap volume before the pricing periodprice. The mechanism by which this is achieved-from the sale is used to subsidize the swap price.DOEUnited States Department of EnergyDow TheoryTheory of market movement developed by Charles-sive higher peaks and higher troughs in an uptrend,and lower peaks and lower troughs in a downtrend.Dow divides trends into primary, secondary and minor.-ern technical theory.
Energy Hedging & Risk Management Glossary7Expiry (Expiration Date)The date by which an option holder must decidewhether to exercise or abandon an option.Extendable SwapAn extendable swap is constructed on the same prin-ciple as the double-up swap , except that instead ofdoubling the swap, the provider has the right to ex-tend the swap, at the end of the agreed period, for afurther predetermined periodFFeedstockRaw material used in a processing plant.Feedstock GasGas used as a raw material for chemical properties increating an end product (like plastics or fertilizer).FERCFederal Energy Regulatory Commission. A US fed-eral agency created in 1977 to regulate, among otherthings, interstate wholesale gas and transportationof gas and electricity at “just and reasonable” rates.Located in Washington.FERC Order 636The 1992 order that unbundled US pipeline services,requiring pipelines to cease their merchant functionand instead become solely a transporter of gas.FibonacciFibonacci levels are commonly observed ratios be-tween the size of a main trend and retracements. Themain ratios are 38.2%, 50%, 61.8%, 100% and 161.8%.These ratios are derived from the number seriesnamed after the Italian mathematician: 1, 1, 2, 3, 5,8, 13, 21, etc... If the first term is divided by the oneto the right of it, the result gets nearer and nearer to0.618, a ratio that recurs in nature and art.Firm GasNatural gas sold on a continuous basis for a definedcontract term.Firm PowerElectricity capacity intended to be available at all timesduring the period covered by a guaranteed commit-ment to deliver, even under adverse conditions, butsubject to force majeure interruptions. Firm powerconsists of either firm energy, firm capacity, or bothForce MajeureDenotes circumstances beyond the control of a com-pany, which force the breaking of a contract.Free on Board (FOB)FOB prices exclude all insurance and freight charges.Most oil is sold either FOB (effectively priced at theloading port) or CIF (effectively priced at the deliveryport).Fuel SwitchingSubstituting one fuel for another based on price andavailability. Large industries often have the capabilityof using either oil or natural gas to fuel their operationand of making the switch on short notice.FuturesAn agreement to make or take delivery of a commod-ity at a fixed date or strip of dates in the future, at aprice agreed upon at the time of dealing.
Energy Hedging & Risk Management Glossary8GGallonThere are 42 US gallons in a barrel.GammaThe rate of change in delta per unit change in theunderlying instrument.GasoilAn intermediate distillate product used for dieselfuel, heating fuel and sometimes as feedstock. In USparlance: No. 2 Heating Oil.GasolineVolatile motor fuel used in cars.GenerationThe process of producing electricity by transformingother forms of energy such as steam, heat or fallingwater. Also, the amount of electricity produced, ex-pressed in kilowatt-hours (kWh) or megawatt-hours(MWh).GeneratorA producer of electricity, both literally and figuratively.Gigajoule (GJ)A joule is an international unit of energy defined asthe energy produced from one watt flowing for onesecond. A very small unit of energy, there are 3-6-miljoules in a kilowatt-hour. For gas, one gigajoule = 0.96Mcf under standard temperature and pressureconditions.Group 3Formerly three railroad companies in Tulsa, Oklahoma.Group 3 now refers to the pipeline price of petroleumcommodities from Tulsa to Minnesota in the US.HHead and ShouldersA reversal pattern characterized by a high, a higherhigh, a lower high, and a break below the line joiningthe lows between the highs, the so-called neck-line.HedgeThe reduction of risk by covering anticipated commit-ments, in the future, through a swap, future or optioncontract.Henry HubA pipeline interchange near Erath, Louisiana, where anumber of interstate and intrastate pipelines intercon-nect through a header system operated by Sabine PipeLine. It is the standard delivery point for the NYMEXnatural gas futures contract in the US.Historic VolatilityThe change in the absolute value of a commodity orinstrument over a certain period, expressed as a per-centage of the lowest price recorded in that period.IIEAInternational Energy Agency
Energy Hedging & Risk Management Glossary9Implied VolatilityThe volatility implied by a certain option price.Index SwapIn the natural gas market in North America, indexswaps are often used to hedge against location pricerisk (a form of basis risk). The seller receives a fixed, orotherwise determined, price and pays the buyer thepublished index value for natural gas from a specifiedlocationInterruptible GasGas sold to customers with a provision that permitscurtailment or cessation of service at the discretion ofthe supplier.Inter-Month SpreadSimultaneous purchase and sale of a future in twoseparate trading periodsIn-The-Money OptionAn option which has intrinsic value. A put option is in-the-money when its strike price is above the value ofthe underlying futures contract. A call option is in-the-money when its strike price is below the value of theunderlying futures contract.Intrinsic ValueThe value to an option holder if (s)he were to exercisean option today.IPPIndependent power producer – Unregulated powergenerators which, unlike utilities, have no franchisedretail service territories. Even a plant built by an inves-tor-owned utility to serve its native retail load is not anIPP. It’s still a utility plant. Also, utilities that form affili-ates and build outside of their territories can be IPPs.KKilowattOne kilowatt equals 1000 watts. Abbreviates to kW.Kilowatt-Hour (KWh)The basic unit for pricing electric energy, equal to onekilowatt of power supplied continuously for one hour(or the amount of electricity needed to light ten 100-watt light bulbs for one hour). One kWh equals 1,000watt-hours. One kWh = 3.306 cu ft of natural gas.LLambdaThe measure of the rate at which fuel is consumedrelative to electric output, expressed in Btu’s per kWh.LIBOR (London Interbank Offered Rate)Forward foreign exchange interest rates.LiftingThe act of loading petroleum or petroleum productsat a terminal or transfer point.Light Crude OilHas an API gravity higher than 33 degrees. The higherthe API gravity, the lighter the crude oil.Light EndsGroup of petroleum products with the lowest boilingtemperatures, including gasolines and distillate fuels.
Energy Hedging & Risk Management Glossary10LiterA liter is 1,000th of a cubic meter. There are 3.78541liters in a gallon.LLSLight Louisiana Sweet. A US crude oil.LNGLiquefied natural gas. Natural gas converted to aliquid state by pressure and severe cooling, andthen returned to a gaseous state to be used as fuel.Acceptable first reference abbreviation. LNG is movedin tankers, not via pipelines. LNG, which is predomi-nantly methane, artificially liquefied, is not to be con-fused with NGLs, natural gas liquids, heavier fractionswhich occur naturally as liquids.LoadThe amount of electricity delivered or required atany specific point or points on a system. The load ofan electricity system is affected by many factors andchanges on a daily, seasonal, and annual basis, typi-cally following a pattern. System load is usually mea-sured in megawatts (MW).Long PositionWhen a trader buys a commodity, in the hope that itsvalue will go up, he is said to be long.LPGLiquefied petroleum gas, typically ethane, propane,butane and isobutane. Usually produced at refineriesor natural gas processing plants, including plants thatfractionate raw natural gas plant liquids. LPG can alsooccur naturally as a condensate.MMarginsA deposit paid on a futures transaction. Initial marginis paid, followed by top-ups as the position develops.Margins are paid to the exchange.Marginal Cost PricingA system of pricing designed to ignore all costs exceptthose associated with producing the next incrementof power generation. Sometimes referred to as incre-mental cost pricing.Mark-to-MarketTo revalue futures/option positions using current mar-ket prices to determine profit/loss.McfOne thousand cubic feet of natural gas.Megawatt (mw)A unit of electrical power equal to one million watts orone thousand kilowatts.Megawatt-Hour (MWh)One million watt-hours of electricity. A unit of electri-cal energy which equals one megawatt of power usedfor one hour.MMbtuOne million British thermal units.MMcfOne million cubic feet of natural gas.
Energy Hedging & Risk Management Glossary11MMSThe US Minerals Management Service, an agency ofthe Interior Department.MogasUsed in some markets as a substitute term forgasoline.MomentumThe simple difference between the price now and theprice N days ago. Momentum is negative if the pricenow is below the price N days ago, and positive if itis above.Mont BelvieuMont Belvieu, Texas. The main propane trading hubalong the United States Gulf Coast.Moving AverageThe mean of prices over a pre-defined period, forinstance, the previous five days. The moving averagefor different time periods can be charted to generateshort- and medium-term buy/sell signals.NNaked OptionA short option position in which the writer does nothave the underlying commodityNational Energy BoardThe Canadian regulatory body which oversees inter-provincial natural gas trade and pipelines. Located inCalgary, Alberta.Natural GasA naturally occurring mixture of hydrocarbon and non-hydrocarbon gases found in porous geological forma-tions beneath the earth’s surface, often in associationwith petroleum. The principal constituent is methaneNGLNatural gas liquids. Can include ethane, propane,butane, isobutane and natural gasoline/condensate.Not to be confused with LNG, liquefied natural gas.LNG is artificially liquefied methane, not the heavierfractions defined as NGLs.NYHNew York Harbor – The delivery point for the NYMEXgasoline and heating oil contracts.NYMEXNew York Mercantile Exchange. Also known in theenergy industry as “the NY Merc”.NEWOil and petrochemicals market abbreviation for North-west Europe.OOfferAn indication of willingness to sell a specified amountof a commodity at a specific price.Off-PeakLight load hours. The time of the day when a powersystem would experience its lightest load, usually inthe middle of the night.
Energy Hedging & Risk Management Glossary12OPECThe Organization of the Petroleum Exporting Coun-tries. Group of crude-producing countries which hasused its collective weight of production since OPECwas founded in 1960 in an attempt to influence oilprices.Open InterestOpen interest is the number of open contracts on agiven future or options contract. Longs or shorts thathave not been closed out are OI. Short-covering/profit-taking will tend to reduce OI.OptionsA contract under which the writer of the option givessomeone the right but not the obligation to buy or sellan underlying commodity, for instance, a futures con-tract. Options can be over-the-counter or exchange-traded.OPISOil Price Information ServiceOut of the Money Option (OTM)An option with an exercise prices lower than the cur-rent market level of the underlying instrument. Suchan option has no intrinsic value, but has got timevalue, as price changes in the underlying might bringit back into the money.Over the Counter (OTC)Bilateral markets in which contracts for futures, op-tions and swaps are written on a tailor-made basis.PPADDPetroleum Allocation for Defense District. A group offive geographic areas in the US used in reference topetroleum distribution.ParkingProviding a customer with temporary gas storage,typically at a market hub.Participation SwapSimilar to a regular swap in that the fixed price payeris fully protected when prices rise above the agreed(fixed) price, with the difference that the client “par-ticipates” in any price decrease.Peak DemandThe maximum load during a specified period of timePeak LoadThe maximum electrical load demand in a statedperiod of time. On a daily basis, peak loads occur atmidmorning and/or in the early eveningPeak Load Plant (Peaker)A plant usually housing low-efficiency, quick responsesteam units, gas turbines, diesels, or pumped-storagehydroelectric equipment normally used during themaximum load periods. Characterized by quick starttimes and generally high operating costs, but lowcapital costsPeaking CapacityCapacity of generating equipment normally reservedfor operation during the hours of highest daily, weekly,or seasonal loads.
Energy Hedging & Risk Management Glossary13Physical DeliveryThe transfer of ownership of an underlying commoditybetween a buyer and seller to settle a futures contractfollowing expiry.Posted PriceOutright, non-market-related price requested by aseller of crude oil or products. Effectively, the list price.PPM (Parts per million)Typically used to designate amount of metals or otherimpurities in refined oil products.Pre-Paid SwapBy means of a pre-paid swap, the fixed payments thatform one side of the cash-flows generated by a stan-dard swap, and which are normally paid over the lifeof the swap, arc discounted hack to their net pre-sentvalue and paid as an immediate cash sum to one ofthe swap counterparties. That counterparty will thenmake floating price pay-merits over the life of theswap, just as in a standard swap.PremiumThe price of an option, as determined by an optionspricing model.PromptA prompt cargo describes a cargo available for imme-diate lifting (one to two days). Prompt tonnage refersto tankers available to lift cargoes immediately.Put OptionThe right, but no the obligation, to sell a commodity,for instance, a future.Puts/Call RatioThe ratio of puts to calls in an options market.RRack PriceThe price of petroleum products at a refinery orwholesale loading rack. Rack-pricing is effectively cashand carry at the rackResistanceA price at which sellers are likely to enter the marketin an uptrend.ResidsOil market jargon for residual fuel oils.ResistanceA price at which sellers are likely to enter the marketin an uptrend.Reverse TollingWhen a gas pipeline recalls gas used for electric gen-eration and diverts it to end-use markets when gasprices are higher than power prices.RFGReformulated gasoline. US specified gasoline formu-lated with a higher oxygen content than pre-1990sgasolines. RFG is specified to contain 2.7% oxygen,and is designed for year-round use in urban areas.So-called oxygenated gasoline is specified with a 2%oxygen content, and is intended for winter use.RhoThe rate of change of the value of an option with re-spect to the risk-free rate of interest.
Energy Hedging & Risk Management Glossary14Roll OverThe transfer of a position from one futures period toanother involving the purchase (sale) of the nearbymonth and simultaneous sale (purchase) of a further-forward month.SSecondary MarketIn natural gas, the trading of transportation capacity.Settlement PriceA price established at the close of a trading day usedto calculate the settlement of futures contracts.Short PositionWhen a trader sells a commodity he doesn’t own, witha view of buying it cheaper at a later date, he is saidto be short.Sour/Sweet CrudeDefinitions which describe the degree of a givencrude’s sulfur content. Sour crudes are high in sulfur,sweet crudes are low.Sour/Sweet GasSour gas is natural gas which contains lethal hydrogensulfide, and must be purified before being injectedinto a pipeline. Sweet gas is gas found in its naturalstate which does not need to be purified to removesulfur-bearing compounds.Spark SpreadThe cost difference of converting natural gas into elec-tricity. It can also be the difference between gas andelectricity futures prices.Spot MarketA market where the commodity being traded is for im-mediate delivery.SPRUnited States Strategic Petroleum ReserveSpreadThe difference between two prices, either across timeor between commodities or instruments.Spread (options)An option trade in which two or more open positionsare established in order to trade the differentials andoffset risk. Option spreads may use different strikeprices and/or expiry dates.Spread-TradingBuying one instrument/commodity and selling an-other, with a view to profiting from the change in thegap between the two markets.Stop-Loss OrderBuy or sell orders put in through a broker, which areautomatically triggered if the price moves above orbelow a certain level.StorageIn oil: typically onland tankage facilities for short- orlong-term storage of crude or products; sometimesused in economic parlance interchangeably with theconcept of oil stocks. In natural gas: facilities used tostore natural gas which has been transferred from itsoriginal location. Usually consists of natural geologicalreservoirs like depleted oil or gas fields, water-bearingsands sealed on top by an impermeable cap rock, un-derground salt domes, bedded salt formations, or inrate cases, abandoned mines.
Energy Hedging & Risk Management Glossary15Straddle (long)The simultaneous purchase of a put and a call optionwith different maturities. This is a bet that volatilitywill increase; the rise in the value of one option willoffset the non-productive premium paid by the otheroption.Straddle (short)The simultaneous sale of a put and a call with differentmaturities, with a view that volatility will go down.StrangleBuying call and buying put with the same maturity.Strike PriceThe price at which an option holder has the right tobuy or sell an underlying commodity/derivative.SupportA price at which buyers are likely to start buying in adowntrend.SwapAn exchange of streams of payments over time accord-ing to specified terms of the contract. Generally oneparty agrees to pay a fixed price in return for receivinga floating price from another party. If the floating pricerises, the buyer of the swap receives a payment fromthe seller of the swap equal to the current marketprice minus the fixed price of the swap. If the floatingprice falls, the buyer of the swap pays the seller of theswap the floating price of the swap minus the currentprice of the swap.SwaptionAn Option to purchase (call swaption) or sell (putswaption) a swap at some future date.TTake-or-PayA clause in an energy (natural gas, electricity, crudeoil) supply contract which provides that a minimumquantity of energy be paid for, whether or not deliveryis accepted by the purchaser.ThetaThe rate of change of the value of an option withrespect to time.ThroughputThe volume of energy flowing through a pipeline,refinery or terminal.Time ValueThe time component in a premium for an option. Typi-cally the time value of an option declines as it movescloser to expiry.Tolling ArrangementAn arrangement whereby a party moves fuel to apower generator and receives kilowatt hours (kWh) inreturn for a pre-established fee.Tolling FeeA fee paid for use of electric generation assets used toconvert fuel to power.UUnconventional GasNatural gas that cannot be produced using currenttechnologies.
Energy Hedging & Risk Management Glossary16Uncovered Position (futures)Where a long market player has bought more of acommodity than he has agreed to sell, or where ashort market player has sold more of a commoditythan (s)he has to deliver.Uncovered Position (options)When the grantor of an options position has no coverin the underlying futures market against a price swingin the holder’s favor (see delta hedging).USACTanker and market abbreviation for US Atlantic Coast.USECPetrochemical markets abbreviation for US East Coast.USGCMarket abbreviation for United States Gulf Coast.USWCTanker and market abbreviation for US West Coast.VVegaThe rate of change of the value of an option withrespect to the volatility of the underlying instrument(also sometimes called kappa).VolatilityA value attributed to an underlying futures contractwhich determines the premium that is set by thegrantor. Includes an element of historical volatility,and the volatility which the grantor of an option be-lieves will still be seen in that futures contract.WWattA measure of real power production or usage equalto one Joule per second. The rate of energy transferequivalent to 1 ampere flowing under a pressure of1 volt.Wet GasNatural gas containing liquefiable hydrocarbons. Nat-ural gasoline, butane, pentane and other light hydro-carbons can be removed by chilling and pressure orextraction. It also refers to gas that has water in excessof 7lb/mil cu ft (MMcf).WheelingIn the gas business, refers to the transfer of gas be-tween pipelines. In the power business, refers to thetransfer of electrons across transmission grids.Wheeling ServiceThe movement of electricity from one system to an-other over transmission facilities of intervening sys-tems. Wheeling service contracts can be establishedbetween two or more systems.WTI (West Texas Intermediate crude oil)WTI crude is deemed to be traded at Cushing, Oklaho-ma. Traders typically refer to the NYMEX Light SweetCrude futures contract as the WTI contract.