Energy Product Derivatives - Rwanda

Rwanda

Highlights

The nominal value in the Energy Product Derivatives market is projected to reach US$4.11bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2029) of 4.72% resulting in a projected total amount of US$5.18bn by 2029.
The average price per contract in the Energy Product Derivatives market amounts to US$0.14 in 2024.
From a global comparison perspective it is shown that the highest nominal value is reached United States (US$26.91tn in 2024).
In the Energy Product Derivatives market, the number of contracts is expected to amount to 31.51k by 2029.

Market definitionIn-Scope/Out-of-scopeMarket structureReportsMethodology

The Energy Product Derivatives market in Rwanda is experiencing a notable shift towards more sophisticated financial instruments.

Customer preferences: Rwandan investors are increasingly showing interest in Energy Product Derivatives as a way to diversify their portfolios and potentially increase returns. The appeal of these financial instruments lies in their ability to hedge against price fluctuations and mitigate risk.

Trends in the market: One prominent trend in the Rwandan Energy Product Derivatives market is the growing demand for futures and options contracts tied to energy commodities. This trend is driven by the need for risk management tools in a market that is becoming more interconnected with global energy dynamics. Additionally, the emergence of online trading platforms has made it easier for investors to access and trade these derivatives.

Local special circumstances: Rwanda's unique position as a landlocked country with limited natural resources influences the Energy Product Derivatives market in several ways. The country's heavy reliance on energy imports makes it particularly sensitive to price volatility in the global energy markets. As a result, market participants in Rwanda are keen on using derivatives to protect themselves from unforeseen price movements.

Underlying macroeconomic factors: The macroeconomic landscape in Rwanda, characterized by steady economic growth and increasing foreign direct investment, provides a conducive environment for the development of the Energy Product Derivatives market. As the country continues to attract foreign investors and diversify its economy, the demand for risk management tools is expected to rise, further driving the growth of the derivatives market.

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.