FYI.

Kal


 -----Original Message-----
From: 	djcustomclips@djinteractive.com@ENRON [mailto:IMCEANOTES-djcustomclips+40djinteractive+2Ecom+40ENRON@ENRON.com] 
Sent:	Friday, June 08, 2001 6:18 AM
To:	156283@mailman.enron.com
Subject:	Enron: E-Trading 'Veteran' EnronOnline Calmly Faces NewcomersEntering Market    and United ...

E-Trading 'Veteran' EnronOnline Calmly Faces NewcomersEntering Market
and United ICE-IPE.

06/07/2001
The Oil Daily
(c) 2001 Energy Intelligence Group. All rights reserved.

In the world of energy e-trade, Enron is one of the veteran players, having
launched its EnronOnline commodity trading platform in November 1999 - and
having completed its one-millionth transaction on the trading system late last
month.

Trading activity on EnronOnline is driven in large part by the Houston-based
company's strength in the North American natural gas and power markets. But
Enron wants the market to know the company is much more than a gas, power, and
now bandwidth trader.
Last week, Enron added crude oil and refined product options to EnronOnline,
to go alongside the existing 52 products the company currently lists in the US
oil market. Larry Gagliardi, director of US crude and products trading for
Enron, says that new contracts are constantly being considered, based mostly
on recommendations from users of its trading platform.

In the US, Enron lists several types of primarily financial crude contracts on
EnronOnline. These include swaps that replicate New York Mercantile Exchange
futures contracts, jet differential swaps, and gasoline crack spreads. Enron
also has a physical West Texas Intermediate contract that is traded
around-the-clock.

The company posts a bid price and offer price for all of those contracts,
which means 104 US crude and product contracts are available on EnronOnline.
In US markets, about 5 million-6 million barrels of firm oil quotes are posted
daily on EnronOnline. The company electronically lists oil contracts through
2002, but the system can accommodate longer-term deals.

Outside the US, Gagliardi says that EnronOnline has been most successful in
European crude markets. "Asia has been a little harder, technologically," he
says, noting that computer technology and internet connections are less
reliable there.

Enron's offerings in Europe include a swap for the differential between dated
Brent quotes and the front-month Brent futures contract on London's
International Petroleum Exchange (IPE), and swaps that mimic the IPE's Brent
and gas oil futures contracts. A range of contracts are offered in Asia,
including straightforward swaps for the Dubai and Tapis crude benchmarks, as
well as for regional gas oil, high-sulfur fuel oil, and kerosene.

When EnronOnline first launched, Gagliardi says, many brokers thought Enron
was committing suicide by posting hundreds of commodity prices online. But the
gamble has paid off. Enron's North American gas and power trading volumes, for
example, have exploded to nearly twice the size of volumes handled by its
nearest competitor, thanks to EnronOnline. Last year, Enron traders used the
trading platform to complete more than 3,000 trades per person, up from 672
per trader in 1999.

In recent months, Enron's trading activities have been overshadowed by other
developments - most notably the oil company-backed IntercontinentalExchange's
planned acquisition of the IPE.

Intercontinental, or ICE, is also making a push in Asian oil markets, having
just opened an office in Singapore. Far East derivatives offered on ICE
include Singapore gas oil, fuel oil, kerosene, and naphtha oil product swaps.
ICE also offers Dubai and Tapis crude oil swaps.

Despite being faced with new competition, Enron's Gagliardi says the company's
strategy hasn't changed. He bets that the liquidity and prices on EnronOnline
will go unmatched by others.

Enron's online trading system is different from most of its rivals. ICE, gas
and power exchange TradeSpark, and others bring together buyers and sellers to
trade anonymously online. On EnronOnline, Enron is a counterparty to every
deal done on its site.

Some traders have criticized Enron's trading platform, saying they prefer
doing deals on exchanges with hundreds of participants - not on an online
platform that they say is a sales channel for Enron.

Gagliardi admits that the exchange model sounds appealing, but says that, so
far, those exchanges have been unable to offer the same trading opportunities
available on EnronOnline.

"The reality of the situation is that no one wants to put out a number and
leave it firm," he says of other online commodity exchanges.

Jeff Gosmano.

(c) Copyright 2001. The Oil Daily Co.

For more infomation, call 800-999-2718 (in U.S.) or

202-662-0700 (outside U.S.).



Folder Name: Enron
Relevance Score on Scale of 100: 98

______________________________________________________________________

To review or revise your folder, visit http://www.djinteractive.com or contact Dow Jones Customer Service by e-mail at custom.news@bis.dowjones.com or by phone at 800-369-7466. (Outside the U.S. and Canada, call 609-452-1511 or contact your local sales representative.)
______________________________________________________________________

Copyright (c) 2001 Dow Jones & Company, Inc. All Rights Reserved