occam: "Yes I know exactly what it is. I also understand puts,...

occam: "Yes I know exactly what it is. I also understand puts, swaps and caps and collars,having dealt in them many times ."

You keep raising your previous experience (which seems is only at retail level) as if that gives weight to your (incorrect) assertions that Woodside has been gambling with their hedge strategy. If you want to go down that track I was a portfolio manager whose (decades of) experience includes setting up and running derivatives' books at 2 major trading banks and I could go on ......

occam: "My question is , how much of your net profit is acceptable to lose to your hedging strategy. In other words , when a company decides to hedge , it should assess the potential downside if the commodity price moves against them . There is a point when the downside becomes unacceptable, or at the very least you should protect your downside ."

Anyway, the question of how much of your net profit you are willing to risk is nonsensical - they are not risking profits but revenue flows from Oil/LNG sales that result in Woodside facing massive price risks. If you are unhedged you wouldn't lose anything on the hedge but you could lose a massive percentage on revenue. Take for example US natural gas - in the last 2 months its price has dropped by over 60%!

How would you look if you weren't hedged with that type of volatility - now that would be a gamble.

occam: "WDS will reevaluate its hedging strategy . You can count on it.

Well of course they will - their hedging strategy will always be under content review, just like anybody's hedging strategy should be.