Oil & Gas
Oil Price Collar — Put Option Premium Paid
Paying the upfront premium for a put option protecting against oil prices falling below a floor.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Derivative Asset (Oil Price Put Option) | Asset (+) | 2,500,000.00 | - |
| Cash / Bank (Premium Paid) | Asset (-) | - | 2,500,000.00 |
💡 Accountant's Note
A price collar combines a put option (price floor protection) with a sold call (cap on upside). The put premium is paid upfront and recognized as a derivative asset. The collar provides budget certainty for RBL debt service.
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