A large energy company has a recurring foreign currency demands, and seeks to use options...

Asian options are a type of derivative that have a payoff based on the average price of the underlying asset over a certain period or on specific dates. This averaging mechanism makes them particularly useful for companies with recurring foreign currency demands, as it helps smooth out volatility and provides a more stable hedge against currency fluctuations. Given the large energy company's need for an option that fits the description of averaging prices over specific dates or within a pricing window, Asian options are the most suitable choice.