INTERCONTINENTAL EXCHANGE LAUNCHES NEW CRUDE FUTURES EXCHANGE IN ABU DHABI.
Abu Dhabi National Oil Company (ADNOC) has partnered with US-based Intercontinental Exchange and nine of the world’s largest energy traders to launch ICE Futures Abu Dhabi (IFAD), a new exchange in Abu Dhabi Global Market that will host the world’s first Murban crude oil futures contracts.
HE Dr. Sultan Ahmed Al Jaber, the UAE Minister of State and ADNOC Group CEO, said, “Having a new, independent exchange in Abu Dhabi will not only benefit the UAE but also physical and financial oil traders around the world.”
The other companies supporting the launch of ICE Futures Abu Dhabi are BP, South Korea’s GS Caltex as well as Thailand’s PTT and PetroChina.
IFAD will be a physically delivered contract with delivery at Fujairah in the UAE on a free on board (FOB) basis.
Similarly, Royal Dutch Shell, Japan’s INPEX Corporation and JXTG Holdings as well as Total and Vitol Group are the other companies supporting the launch of ICE Futures Abu Dhabi.
Contracts traded at IFAD will be subject to regulatory approval, will be cleared at ICE Clear Europe and will clear alongside ICE Brent, ICE WTI as well as ICE (Platts) Dubai and ICE Low Sulphur Gasoil—allowing customers to benefit from associated margin offsets, delivering meaningful capital efficiencies.
“Partnering with ADNOC and nine of the world’s largest physical traders of Murban crude to launch ICE Futures Abu Dhabi is a significant endorsement and strong signal of the potential for Murban to become a new global crude benchmark,” said Jeffrey C. Sprecher, the Chairman and Chief Executive Officer of Intercontinental Exchange.
IFAD and ICE Clear Europe are working to receive regulatory approval from key jurisdictions and, subject to receiving these, expect to launch in the first half of 2020, according to local newswire, WAM.
Earlier this month, Abu Dhabi’s Supreme Petroleum Council (SPC) approved the launch of a new pricing mechanism for Abu Dhabi National Oil Company’s (ADNOC) Murban crude, as part of the company’s broader transformation strategy.
Murban Crude is a light sweet crude produced by ADNOC. The state-owned oil company produces around three million barrels of oil per day, of which approximately 1.7 million barrels per day is Murban crude.