Risk Management
The Company’s trading operations come with inherent risks that are typical in the commodities business, including price volatility, foreign exchange fluctuations, interest rate changes, liquidity challenges, and credit risks, among others. While many of these risks are unavoidable in this industry, they can be closely monitored and effectively managed.
Petroforce has implemented a range of policies aimed at mitigating and managing these risks. These policies represent crucial components for ensuring the company’s stability and sustained growth. These include:
Implementation of CTRM system to reduce operational risk, exposure management and efficient way to recognize and report risk.
To manage risk, company has been working on setting up of Trading Policy, Risk Management Policy, Commodity Hedge Policy, Business Activity Manuals, Trading Authorization Limits & Credit Risk Policy.
Company uses Financial derivative instruments to hedge commodity price risk, basis risk, timing risk and FX risks so that economics of trades are protected.
Strict policies and procedures to hedge counterparty relationships, fraud and regulatory risks.
Ready access to sufficient capital and funding to hedge liquidity risks.
Insurance to hedge various operational risks including freight related and political risks.