The futures market in West Texas Intermediate crude oil was introduced in 1983 with a posted-price cash market in which the posted price changed a few times a year. By 2002, the cash price changed almost daily. Evidence from producers’ invoices shows that this initially low frequency of price changes reflects transactions prices. Using experiments, we show that the introduction of a futures mar...

Due to increase in demand for utilizing public Cloud resources, we are facing with many trade-offs between price, performance and recently reliability. Amazon’s Spot Instances (SIs) provide a low price yet less reliable and competitive bidding option for the public Cloud users. Although some works have explored the utilization of SIs to decrease the monetary cost of Cloud computing, the charact...

In this study, an empirical mode decomposition (EMD) based neural network ensemble learning model is proposed for world crude oil spot price modeling and forecasting. For this purpose, the original crude oil spot price series were first decomposed into a finite and often small number of intrinsic mode functions (IMFs). Then the three-layer feed-forward neural network (FNN) model was used to mod...

This paper examines the price volatility in the silver spot (cash) market. A host of Generalized Autoregressive Conditional Heteroskedasticity (GARCH) models are used to analyze and gain a better understanding of the volatility of silver prices. We find the TGARCH (1,1) model indicates that both positive and negative shocks do not have a significant effect on volatility in the silver spot marke...

Oil producers are going through a hard period. They have a number of real options at their disposal. This paper addresses the valuation of two of them: the option to delay investment and the option to abandon a producing field. A prerequisite for this is to determine the value of a producing well. For this purpose we draw on a stochastic model of oil price with three risk factors: spot price, l...

The surge in demand for utilizing public Cloud resources has introduced many trade-offs between price, performance and recently reliability. Amazon’s Spot Instances (SIs) create a competitive bidding option for public Cloud users at lower prices without providing reliability on services. It is generally believed that SIs reduce monetary cost to the Cloud users, however it appears from the liter...

In the current paper, we examine the effect of a B2B spot market on the strategic behavior and the performance of a reseller who continues to use the traditional channel while participating in a B2B spot market. We analyze the case in which a risk-neutral reseller faces an additive or multiplicative demand function and identify sufficient conditions under which the optimal order quantity and re...

We consider the problem of an electric-power marketer offering a fixed-price forward contract to provide electricity that it purchases from a potentially volatile and unpredictable fledgling spot energy market. One option for the risk-averse marketer who wants to hedge against the spot-price volatility is to engage in cross hedging to reduce the contract’s profit variance, and to determine the ...

For decades, humans have been consuming large quantities of oil, coal and natural gas. Consequently, people must now take responsibility for having participated in productive activities that have caused the emissions of greenhouse gas (GHG) which has damaged the environment and caused problems associated with abnormal weather. Previous studies investigated the relationships between energy and c...

Cloud providers possessing large quantities of spare capacity must either incentivize clients to purchase it or suffer losses. Amazon is the first cloud provider to address this challenge, by allowing clients to bid on spare capacity and by granting resources to bidders while their bids exceed a periodically changing spot price. Amazon publicizes the spot price but does not disclose how it is d...