Energy Product Derivatives - Portugal

Portugal

The nominal value in the Energy Product Derivatives market is projected to reach US$86.77bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2029) of 6.18% resulting in a projected total amount of US$117.10bn by 2029.
The average price per contract in the Energy Product Derivatives market amounts to US$0.26 in 2024.
From a global comparison perspective it is shown that the highest nominal value is reached in the United States (US$26,910.00bn in 2024).
In the Energy Product Derivatives market, the number of contracts is expected to amount to 366.70k by 2029.

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Analyst Opinion

The Energy Product Derivatives market in Portugal is experiencing a notable shift in recent years.

Customer preferences: Customers in Portugal are increasingly turning to Energy Product Derivatives as a way to diversify their investment portfolios and hedge against market volatility. With a growing awareness of the potential risks and rewards associated with derivatives, investors are showing more interest in these financial instruments.

Trends in the market: One of the key trends in the Energy Product Derivatives market in Portugal is the emphasis on renewable energy derivatives. As the country strives to meet its renewable energy targets, there is a rising demand for derivatives linked to solar, wind, and hydroelectric power. This trend is in line with the global shift towards sustainable energy sources and reflects Portugal's commitment to environmental sustainability.

Local special circumstances: Portugal's unique position as a leader in renewable energy production within Europe is shaping the Energy Product Derivatives market in the country. The government's strong support for renewable energy projects and the favorable regulatory environment are driving the development of new derivative products tailored to this sector. Additionally, the country's geographic location and climate make it an ideal market for renewable energy investments, further fueling the demand for related derivatives.

Underlying macroeconomic factors: The overall economic stability and growth in Portugal are also contributing to the expansion of the Energy Product Derivatives market. As the economy continues to recover from past challenges, investors are gaining confidence in the market and are more willing to explore derivative products. Additionally, the low interest rate environment in the Eurozone is pushing investors towards alternative investment options like derivatives, further boosting market activity.

Methodology

Data coverage:

Figures are based on commodity derivatives, their notional value, the number of contracts traded, the open interest (outstanding contracts at the end of a year), and the average value of a contract.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use market research & analysis, and data of World Bank, as well as the World Federation of Exchanges. Furthermore, we use relevant key market indicators and data from country-specific associations and national data bureaus such as GDP, wealth per capita, and the online banking penetration rate. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are GDP per capita an the online banking penetration rate.

Additional Notes:

The market is updated twice per year in case market dynamics change.