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ICE introduces new Marine Fuel 0.5% futures contracts

14 Dec 2018

Global exchange, clearing house and provider of data and listings services Intercontinental Exchange (ICE) on Thursday announced plans to launch new Marine Fuel 0.5% futures contracts in advance of the implementation of the 0.5% sulphur cap by the International Maritime Organization (IMO) in 2020.

The new contracts are expected to launch on February 4, 2019, subject to completion of relevant regulatory processes.

ICE’s new futures contracts will settle against S&P Global Platts physical marine fuel 0.5% assessments. The contracts are as follows:

  • Fuel Oil Outright – Marine Fuel 0.5% FOB Rotterdam Barges (Platts) Future
  • Fuel Oil Outright – Marine Fuel 0.5% FOB Singapore (Platts) Future
  • Fuel Oil Diff – Marine Fuel 0.5% FOB Rotterdam Barges (Platts) vs 3.5% FOB Rotterdam Barges (Platts) Future
  • Fuel Oil Diff – Marine Fuel 0.5% FOB Singapore (Platts) Future vs 380 CST Singapore (Platts) Future
  • Fuel Oil Outright – Marine Fuel 0.5% FOB USGC Barges (Platts) Future
  • Fuel Oil Diff – Marine Fuel 0.5% FOB USGC Barges (Platts) vs USGC HSFO (Platts) Future

The new contracts have been developed in response to significant market demand in advance of the IMO regulation limiting sulphur emissions from shipping bunker fuel from January 2020.

“Our customers have expressed a strong desire for Marine Fuel 0.5% specific derivative contracts and our new contracts will allow market participants to hedge forward positions in an industry which today consumes more than three million barrels per day of high sulphur fuel oil,” said Jeff Barbuto, Vice President of Oil Markets at ICE.

“The contracts will operate alongside ICE’s benchmark Low Sulphur Gasoil futures, fuel oil and LNG markets providing customers with a range of hedging tools to assist with the transition to the new regulations in 2020.”

Published: 14 December, 2018
 

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