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Trade Lifecycle Overview

The trade lifecycle document outlines the key stages and activities involved in an oil trade transaction. The three stages are 1) pre-trade which involves documentation and credit approvals, 2) trade where the terms are negotiated and approved, and 3) post-trade which includes capturing the trade details, matching/affirmation with the other party, exchanging confirmations, scheduling physical delivery if applicable, and final settlement.

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128 views1 page

Trade Lifecycle Overview

The trade lifecycle document outlines the key stages and activities involved in an oil trade transaction. The three stages are 1) pre-trade which involves documentation and credit approvals, 2) trade where the terms are negotiated and approved, and 3) post-trade which includes capturing the trade details, matching/affirmation with the other party, exchanging confirmations, scheduling physical delivery if applicable, and final settlement.

Uploaded by

Vishnu
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Trade Life cycle

Stage Activity Definition


1. Pre-trade Bilateral documentation and Proper documentation and Credit
internal approvals & agreed line checks on the basis of which
terms. Trading limits are decided
2. Trade Execution of Trade Parties agree on terms via phone,
fax, and/or electronic means for
Price and Quantity for a particular
month contract of Mondo Crude.
Post that it is routed to Risk
Management team for the approval
of Exposure taken.
3. Post-trade Trade capture Once we get the approval from Risk
ETRM systems handle Management team the Trade details
this part are captured.
Trade affirmation or matching Trade Matching is done by the
clearing house/Financial
Intermediary/Dealer and the
confirmation of the same given to
both the counter parties.
Confirmation Final confirmation of the trade
details are secured and exchanged.
Confirmations may be paper- or
electronic-based. Or via email on
ISDA format.
Scheduling Physical deals will be sent for
delivery via ships, pipelines,etc
Settlement As per the settlement procedure
mentioned in the contract that will
be done Example – Cash
Settlement ,EFP (Exchange for
Physical) etc..

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