TransCanada Starts Up Oil Trading Unit as Rout Boosts Volatility

  • Company follows rival Enbridge in marketing crude volumes
  • Traders can take advantage of volatile crude oil prices

TransCanada Corp., one of Canada’s largest energy companies, has formed an oil trading division amid a market slump.

Terry Cunha, a spokesman for Calgary-based TransCanada, said Friday that the group has begun trading and declined to offer more details in an e-mail.

The pipeline builder and power generator follows rival Enbridge Inc., which owns Tidal Energy Marketing Inc., a Calgary-based energy marketing company. Oil traders can take advantage of price volatility and a market structure known as contango that allows them to lock in profits by buying and storing oil to deliver at higher prices in the future.

The Chicago Board Options Exchange Crude Oil Volatility Index jumped to 67.93 on Wednesday, the highest level since March 2009.

TransCanada is the nation’s fourth-largest energy company by market value. The company generated 48 percent of its revenues in 2014 from natural gas pipelines, 37 percent from its power division and the remaining 15 percent from oil conduits, according to data compiled by Bloomberg.

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