Intercontinental Exchange, the leading global provider of trading platforms and clearing, has posted record activity in two key LNG trading derivatives, US Henry Hub natural gas and the Dutch Title Transfer Facility (TTF), the European benchmark.
ICE also announced record total futures open interest of more than 48.1 million contracts on August 25.
The platform’s North American natural gas futures and options, which includes the Henry Hub and US Basis Markets contracts, hit record open interest of 23 million, up 10 percent year-over-year, with open interest in Henry Hub futures and options up 28 percent year-on-year.
The natural gas futures and options reached record open interest of almost 3.3 million contracts.
The Dutch TTF is increasing in importance as energy traders and asset owners manage their global gas price risk.
The Dutch TFF, reflecting LNG cargo values in Europe, was last at $16.50 per million British thermal units and tight natural gas markets in the European Union and in the UK.
The UK National Balancing Point benchmark natural gas prices was even higher than the Dutch TTF at $16.85 per MMBtu on August 30.
“TTF holds open interest out to December 2028. In June, ICE extended the TTF curve to December 2031 following demand from commercial hedgers to further align TTF with typical lengths of medium to long term deals between LNG buyers and sellers, and to help market participants manage long term risk,” explained ICE.
“The globalization of natural gas, which is contributing to the growth of TTF, has also led to the establishment of the Asian natural gas benchmark ICE JKM LNG (Platts) where open interest is up 26 percent year-on-year,” said ICE.
The Henry Hub, Dutch TTF, JKM and NBP futures and options form part of ICE’s global natural gas complex alongside the West India Marker (WIM) LNG (Platts) and the Spark LNG Freight Futures contracts
.Open interest across ICE’s global environmental complex was also up 21 percent across futures and options, as participants use these markets to also price climate risk.
“As the market manages changes in interest rates, open interest in Interest Rate futures and options is up 26 percent year-on-year,” ICE added.