CTRM Software: How Commodity Trading Systems Use Price Data

Commodity Trading and Risk Management (CTRM) software is the operational backbone of physical commodity trading. From oil majors to regional fuel distributors, CTRM systems track positions, manage risk, and value portfolios. This guide explains how CTRM systems use price data and how to integrate real-time commodity feeds.

What Is CTRM Software?

CTRM (Commodity Trading and Risk Management) software manages the complete lifecycle of physical commodity trades:

Core Functions

Market Segments

How CTRM Systems Use Price Data

1. Position Valuation (Mark-to-Market)

The most critical use of price data—valuing open positions at current market rates:

Position Value = Quantity × Current Price

Example:
- Long 100,000 barrels WTI at $72.00 entry
- Current WTI: $76.50
- Position Value: 100,000 × $76.50 = $7,650,000
- Unrealized P&L: 100,000 × ($76.50 - $72.00) = $450,000

CTRM systems need prices for:

• Physical positions (cargo, storage)
• Paper positions (futures, swaps)
• Basis positions (location differentials)

2. Risk Calculations

Risk management requires continuous price updates:

3. P&L Attribution

Understanding where profits come from:

P&L Components:
├── Flat Price P&L: Underlying price movement
├── Basis P&L: Location differential changes
├── Time Spread P&L: Calendar spread changes
└── FX P&L: Currency movements on USD positions

Each component requires specific benchmark prices.

4. Trade Decision Support

Traders need current prices for:

• Deal economics (is this trade profitable?)
• Arbitrage identification (location spreads)
• Hedging decisions (when to offset risk)

Integrating Price Data into CTRM

Architecture Patterns

Pattern 1: Polling (Simple)

CTRM System → Scheduled Requests → OilPriceAPI
     ↓
  Database

Pros: Simple to implement Cons: Delays between updates, wastes API calls

Pattern 2: Webhooks (Push)

OilPriceAPI → Webhook → Your Server → CTRM Database
                              ↓
                         CTRM System

Pros: Real-time updates, efficient Cons: Requires webhook endpoint

Pattern 3: WebSocket (Streaming)

OilPriceAPI WebSocket → Your Service → CTRM System
                              ↓
                         Price Cache

Pros: Lowest latency, continuous feed Cons: Requires connection management

Webhook Integration Example

Configure OilPriceAPI to push price updates to your CTRM:

# Set up webhook for WTI price updates
curl -X POST "https://api.oilpriceapi.com/v1/webhooks" \
  -H "Authorization: Token YOUR_API_KEY" \
  -H "Content-Type: application/json" \
  -d '{
    "url": "https://your-ctrm.com/api/price-updates",
    "commodity_codes": ["WTI_CRUDE_USD", "BRENT_CRUDE_USD", "NATURAL_GAS_USD"],
    "trigger": "price_change"
  }'

Your CTRM endpoint receives:

{
  "event": "price_update",
  "timestamp": "2026-01-30T15:30:00.000Z",
  "data": {
    "code": "WTI_CRUDE_USD",
    "price": 76.85,
    "previous_price": 76.42,
    "change": 0.43,
    "change_percent": 0.56
  }
}

Python Integration Service

Build a price feed service for your CTRM:

from flask import Flask, request
import requests
from datetime import datetime

app = Flask(__name__)

class CTRMPriceFeed:
    def __init__(self, api_key, ctrm_connection):
        self.api_key = api_key
        self.ctrm = ctrm_connection
        self.base_url = "https://api.oilpriceapi.com/v1"
        self.headers = {"Authorization": f"Token {api_key}"}

    def get_all_prices(self, commodity_codes):
        """Fetch current prices for CTRM mark-to-market."""
        response = requests.get(
            f"{self.base_url}/prices/latest",
            params={"by_code": ",".join(commodity_codes)},
            headers=self.headers
        )
        return response.json()

    def update_ctrm_prices(self, prices):
        """Push prices to CTRM system."""
        for price in prices:
            self.ctrm.update_price(
                commodity=price["code"],
                price=price["price"],
                timestamp=price["created_at"]
            )

    def run_mtm_cycle(self):
        """Run complete mark-to-market cycle."""
        # Define commodities your CTRM tracks
        commodities = [
            "BRENT_CRUDE_USD",
            "WTI_CRUDE_USD",
            "NATURAL_GAS_USD",
            "HEATING_OIL_USD",
            "VLSFO_SGSIN_USD"
        ]

        prices = self.get_all_prices(commodities)
        self.update_ctrm_prices(prices.get("data", {}).get("prices", []))

        return {
            "status": "success",
            "prices_updated": len(commodities),
            "timestamp": datetime.utcnow().isoformat()
        }

# Webhook endpoint
@app.route("/api/price-updates", methods=["POST"])
def receive_price_update():
    """Handle incoming price webhooks from OilPriceAPI."""
    data = request.json

    # Validate webhook signature (if configured)
    # verify_webhook_signature(request)

    # Update CTRM with new price
    price_feed.ctrm.update_price(
        commodity=data["data"]["code"],
        price=data["data"]["price"],
        timestamp=data["timestamp"]
    )

    # Trigger position revaluation if needed
    if data["data"]["change_percent"] > 1.0:
        price_feed.ctrm.trigger_mtm_recalc()

    return {"status": "received"}, 200

# Scheduled MTM (backup to webhooks)
@app.route("/api/run-mtm", methods=["POST"])
def run_mtm():
    """Manual trigger for mark-to-market cycle."""
    result = price_feed.run_mtm_cycle()
    return result, 200

JavaScript Integration for Cloud CTRM

const axios = require("axios");

class CTRMPriceService {
  constructor(apiKey, ctrmClient) {
    this.apiKey = apiKey;
    this.ctrmClient = ctrmClient;
    this.baseUrl = "https://api.oilpriceapi.com/v1";
  }

  async fetchPrices(commodityCodes) {
    const response = await axios.get(`${this.baseUrl}/prices/latest`, {
      params: { by_code: commodityCodes.join(",") },
      headers: { Authorization: `Token ${this.apiKey}` },
    });
    return response.data;
  }

  async syncPricesToCTRM(commodityCodes) {
    const priceData = await this.fetchPrices(commodityCodes);
    const prices = priceData.data.prices || [priceData.data];

    const updates = prices.map((p) => ({
      commodityCode: p.code,
      price: p.price,
      currency: p.currency,
      timestamp: p.created_at,
      source: "OilPriceAPI",
    }));

    // Batch update CTRM
    await this.ctrmClient.batchUpdatePrices(updates);

    return {
      updated: updates.length,
      timestamp: new Date().toISOString(),
    };
  }

  async calculatePositionMTM(positions) {
    // Get unique commodity codes from positions
    const codes = [...new Set(positions.map((p) => p.commodityCode))];

    // Fetch current prices
    const priceData = await this.fetchPrices(codes);
    const priceMap = {};
    (priceData.data.prices || [priceData.data]).forEach((p) => {
      priceMap[p.code] = p.price;
    });

    // Calculate MTM for each position
    return positions.map((pos) => ({
      ...pos,
      currentPrice: priceMap[pos.commodityCode],
      mtmValue: pos.quantity * priceMap[pos.commodityCode],
      unrealizedPnL:
        pos.quantity * (priceMap[pos.commodityCode] - pos.entryPrice),
    }));
  }
}

// Usage
const priceService = new CTRMPriceService("YOUR_API_KEY", ctrmClient);

// Sync prices for daily MTM
await priceService.syncPricesToCTRM([
  "BRENT_CRUDE_USD",
  "WTI_CRUDE_USD",
  "NATURAL_GAS_USD",
]);

// Calculate position values
const positions = [
  {
    id: 1,
    commodityCode: "BRENT_CRUDE_USD",
    quantity: 50000,
    entryPrice: 74.5,
  },
  { id: 2, commodityCode: "WTI_CRUDE_USD", quantity: -25000, entryPrice: 72.0 },
];

const mtmPositions = await priceService.calculatePositionMTM(positions);
console.log("Position MTM:", mtmPositions);

Commodity Coverage for CTRM

Price Codes for Common CTRM Commodities

Supplementary Data for CTRM Analytics

Best Practices

Data Integrity

1. Timestamp all prices: Store both your receipt time and source timestamp
2. Maintain price history: Keep historical snapshots for audit
3. Handle gaps: Define fallback logic for missing prices
4. Validate prices: Flag unusual moves (>10% intraday)

Performance

1. Batch requests: Fetch multiple prices in single API calls
2. Cache strategically: Prices don't change every second
3. Use webhooks: Avoid polling when possible
4. Implement retry logic: Handle transient failures gracefully

Compliance

1. Data attribution: Document price sources for regulatory reporting
2. Audit trail: Log all price updates with timestamps
3. Data residency: Understand where price data is stored

Getting Started

1. Sign up at oilpriceapi.com/signup
2. Get your API key from the dashboard
3. Map your CTRM commodities to OilPriceAPI codes
4. Build integration using webhook or polling pattern
5. Test mark-to-market calculations with sample positions

The free tier includes 1,000 requests monthly—enough to prototype your CTRM integration before production deployment.

Frequently Asked Questions

What CTRM systems does OilPriceAPI integrate with?

OilPriceAPI provides a standard REST API and webhook interface that integrates with any CTRM system capable of receiving HTTP requests. This includes Openlink, Allegro, Brady, Aspect, and custom-built systems. We don't provide native connectors, but our API is straightforward to integrate.

How often should I update prices in my CTRM?

It depends on your trading activity. Most physical trading desks update prices every 15 minutes during market hours, with end-of-day snapshots for official MTM. For active trading, use WebSocket streaming or webhooks for real-time updates. Our Professional tier supports both patterns.

Can I get historical prices for settlement calculations?

Yes, use the /prices/historical endpoint to retrieve prices for specific dates. This is useful for calculating settlement prices, month-end valuations, and historical P&L analysis. Historical data is available on all plans.

How do I handle multiple price sources in my CTRM?

Most CTRM systems maintain a price hierarchy—primary source, secondary source, fallback. Configure OilPriceAPI as a source and define rules for when to use each. Our API includes timestamps and data freshness indicators to help you manage source selection.

What about exchange-traded futures prices?

OilPriceAPI focuses on spot commodity prices. For exchange-traded futures (CL, NG, etc.), you may need a separate futures data provider. Many CTRM implementations use OilPriceAPI for physical benchmarks and a futures feed for paper positions.

Related Resources

• Commodities Trading Solution - Trading desk integration
• Webhook Configuration - Real-time price feeds
• WebSocket Documentation - Streaming prices
• Financial Data API Guide - API comparison
• API Reference - Complete endpoint documentation