FEEDSTOCKS
Natural gas or crude products used in a refinery or petrochemical plant for processing.

FIRM CAPACITY
Amount of gas in a buyer’s contract that is guaranteed not to be interrupted.

FIRM SERVICE
Gas or electricity sales that are guaranteed not to be interrupted.

FLEXIBILITY BID
In the gas market, where the system needs to buy or sell gas to keep it in balance, a shipper may put in a flexibility bid. He specifies whether it is a buy or sell, the date or dates to which it applies, the amount of gas, the calorific value of the input gas, how quickly it could be implemented, how and where it would be implemented and the price.

FORCE MAJEURE
A contract clause which allows the supplier to forego his obligation to supply in extreme circumstances such as a political crisis, war, strikes which disturb production, etc. It also applies to a purchaser who is unable to take delivery of product – eg, a refiner whose refinery is shut down following a disaster.

FORWARD CONTRACTS
Where products are traded ahead of their physical loading.

FORWARD START OPTION
An option that gives the purchaser the right to receive, after a specified time, a standard put or call option. The option’s strike price is set at the time the option is activated rather than when it is purchased and is usually set with reference to the prevailing spot rate when the option is activated.

FORWARD SWAP
A swap in which payments are fixed before the start date; used when one party expects market rates to rise soon, but will not need funds until later.

FUNDAMENTAL ANALYSIS
To analyse supply and demand factors, including weather patterns, that could influence the direction of price of a commodity.

FUTURES CONTRACT
An exchange-traded supply contract between a buyer and a seller whereby the buyer is obligated to take delivery and the seller is obligated to provide delivery of a fixed amount of a commodity at a predetermined price at a specified location. Futures contracts are traded exclusively on regulated exchanges and are settled daily based on their current value in the marketplace. Some futures contracts have deviated from the traditional futures contract in that they are cash-settled, with no physical delivery possible.

FUTURES OPTION
An option on a futures contract. Also known as an option on a future.