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Financial Risks

To accurately set our risk exposure limits, we identify and quantify our key risks. As a general principle, the Company covers, by taking appropriate policies for risks that are insurable, including political and sovereign risks (which includes coup, civil unrest, forced abandonment, expropriation and nationalisation risks), inventory, fixed assets, storage, inland and marine transit risks. The non-insurable risks are operational risks, information risks and trading risks. Trading risks are further sub-categorised into commodity outright price risk, basis or spread risk, counterparty risk, credit risk and currency risk. For these non-insurable risks, the Company uses forward contracts, financial instruments and volume/tenor limits to manage the residual exposures.