Formosa Petrochemical Announces Reaching Loss Limit in Derivative Financial Product Transactions
Formosa Petrochemical Corporation announced reaching a loss limit of US$6.699 million in energy derivative transactions. The company stated that this was a hedging transaction aimed at mitigating risks from the Middle East situation due to volatile crude oil prices, and it has no significant impact on the company.
📋 Article Processing Timeline
- 📰 Published: May 5, 2026 at 09:00
- 🔍 Collected: May 6, 2026 at 08:00 (23h 0m after Published)
- 🤖 AI Analyzed: May 6, 2026 at 08:34 (34 min after Collected)
1. Type of contract: Swaps
2. Date of occurrence: May 5, 2026 (Minguo Year 115/5/5)
3. Contract amount: US$21,550,000
4. Amount of margin or premium paid: None
5. Total or individual contract loss limit as stipulated in the handling procedures: Individual energy derivative product contract losses are limited to US$5 million, and total contract losses are limited to US$18 million.
6. Reason for engaging in derivative product transactions: For hedging purposes.
7. Hedged item: Crude oil
8. Amount of hedged item position: US$21,550,000
9. Profit and loss status of hedged item: Realized loss of US$6,699,000
10. Loss amount based on fair value assessment (including realized and unrealized): Individual contract realized loss of US$6,699,000
11. Reason for loss and impact on the company: The company engages in energy derivative products purely for hedging purposes. This transaction was to hedge against risks from the Middle East situation. Due to recent severe fluctuations in crude oil prices, the realized loss for a single futures contract reached its limit. As it is a hedging transaction, it has no significant impact on the company.
12. Contract period: April 1, 2026 to April 30, 2026 (Minguo Year 115/4/1~115/4/30)
13. Restrictions: None
14. Other important agreed matters: None
15. Other explanations: None
Keywords: Material Information
2. Date of occurrence: May 5, 2026 (Minguo Year 115/5/5)
3. Contract amount: US$21,550,000
4. Amount of margin or premium paid: None
5. Total or individual contract loss limit as stipulated in the handling procedures: Individual energy derivative product contract losses are limited to US$5 million, and total contract losses are limited to US$18 million.
6. Reason for engaging in derivative product transactions: For hedging purposes.
7. Hedged item: Crude oil
8. Amount of hedged item position: US$21,550,000
9. Profit and loss status of hedged item: Realized loss of US$6,699,000
10. Loss amount based on fair value assessment (including realized and unrealized): Individual contract realized loss of US$6,699,000
11. Reason for loss and impact on the company: The company engages in energy derivative products purely for hedging purposes. This transaction was to hedge against risks from the Middle East situation. Due to recent severe fluctuations in crude oil prices, the realized loss for a single futures contract reached its limit. As it is a hedging transaction, it has no significant impact on the company.
12. Contract period: April 1, 2026 to April 30, 2026 (Minguo Year 115/4/1~115/4/30)
13. Restrictions: None
14. Other important agreed matters: None
15. Other explanations: None
Keywords: Material Information