LNG

Intercontinental Exchange, the leading operator of global energy derivative exchanges and clearing houses, reported an increase in first-quarter revenues as it continued to launch new products to meet customer demand, including most recently LNG freight futures and a range of Abu Dhabi oil futures and options.

ICE said in the quarter ended March 31, 2021, consolidated net revenues were $1.8 billion, up 15 percent year-over-year including exchange net revenues of $974M, fixed income and data services revenues of $468M and mortgage technology revenues of $355M.

Revenue from energy trading products dropped by 12 percent overall in the quarter after the winter peak to $310M from $353M in the same three months of $2020.

Exchanges operating income for the first quarter came to $653M and operating margin was 67 percent.

ICE, based in Atlanta, Georgia, launched its LNG freight futures contracts on March 23 based on price assessments from Spark Commodities with 30 lots traded on the first day.

First day trading included 15 lots of Spark30S Atlantic and 15 lots of Spark25S Pacific LNG freight futures contracts for the June 2021 contract expiry.

These first trades involved some of the LNG industry’s leading market participants including Total, Gunvor, Vitol, and Glencore, and were brokered by Clarksons, showing strong support for the new contracts.

ICE introduced the new LNG freight futures based on price assessments from Spark Commodities, a provider of technology-based solutions for promoting market liquidity.

Singapore-based Spark is backed by French data firm Kpler and EEX, part of the Deutsche Börse Group.

LNG and gas products

The ICE freight contracts form part of ICE's global natural gas complex alongside existing benchmark natural gas and LNG derivatives such as the Dutch TTF, the UK National Balancing Point, US Henry Hub, JKM LNG (Platts) and the West India Marker (WIM LNG) contracts.

“We are pleased to report strong first-quarter results that extend our track-record of growth. As we emerge from the Covid-19 pandemic, never have our digital networks proven more needed and resilient,” said Jeffrey C. Sprecher, ICE Chairman and Chief Executive.

“We are grateful to our customers that continue to rely on our technology, data and market infrastructure, and we remain focused on innovating across asset classes to drive greater efficiency and transparency,” declared Sprecher.

Adjusted net income attributable to ICE increased by 9 percent to $758M compared with $695M in the 2020 first quarter.

Free cash flow amounted to $702M versus $434M in the prior-year period.

At the end of the quarter on March 31, ICE launched its oil futures contract for LNG exporter Abu Dhabi and a total of 8,854 cleared lots were traded on the first day.

The start of trading of the ICE Murban Crude Oil Futures (IFAN) had been delayed from 2020 by the market oil market slump and Covid-19.

ICE Murban Crude Oil Futures opened for trading alongside 18 Murban-related cash settled derivatives and inter-commodity spreads, offering the market the broadest range of ways to trade and hedge Murban crude.

Market activity on ICE Futures Abu Dhabi on the first day of trading included 6,344 ICE Murban Crude Oil futures contracts and 2,510 Murban related cash settled derivative contracts.

A total of 27 firms traded on day one of the launch.

Intercontinental Exchange, the leading operator of global energy derivative exchanges and clearing houses, has launch its oil future contract for liquefied natural exporter Abu Dhabi and a total of 8,854 cleared lots were traded on the first day.

The start of trading of the ICE Murban Crude Oil Futures (IFAN) had been delayed from 2020 by the market oil market slump and the Covid-19 pandemic.

ICE Murban Crude Oil Futures opened for trading alongside 18 Murban-related cash settled derivatives and inter-commodity spreads, offering the market the broadest range of ways to trade and hedge Murban crude.

Market activity on ICE Futures Abu Dhabi on the first day of trading included 6,344 ICE Murban Crude Oil futures contracts and 2,510 Murban related cash settled derivative contracts.

A total of 27 firms traded on day one of the launch.

Of the cash settled derivatives, 2,500 lots of Murban Singapore Marker 1st Line futures and 10 lots of Murban 1st Line vs Brent 1st Line futures contracts traded.

“The depth of market activity on our first day of trading is extremely encouraging,” said Jamal Oulhadj, President of ICE Futures Abu Dhabi.

“On the first day of launch we saw active trading, consistently tight bid offer spreads, a high number of participants from both the physical and financial sides of the market, and liquidity out for the first six months of the curve,” added Oulhadj.

“The mix of trading across the Murban futures contract and the cash settled derivatives reflects how our customers are already beginning to utilize the extensive range of tools we offer to trade and hedge Murban crude price exposure,” he stated.

ICE points out that Murban futures are open for trading for 24 hours a day on Mondays and 22 hours a day Tuesdays to Fridays, with investors from jurisdictions including the Abu Dhabi Global Market, the US, Singapore, the UK, Switzerland, the Netherlands, France, Norway, Australia, Japan and South Korea, able to trade on IFAD.

IFAD has 26 Exchange Members and 19 Clearing Members, who are listed in full on IFAD’s membership page.

“Contracts traded on IFAD are cleared at ICE Clear Europe where they are cleared alongside ICE’s global energy futures platform covering oil, natural gas and the environmental complex, allowing customers to benefit from critical margin offsets to enhance capital efficiency,” explained ICE.

Intercontinental Exchange, the leading operator of global energy derivative exchanges and clearing houses, said the launch of the world’s newest oil futures contract for liquefied natural exporter Abu Dhabi is on track for a March 29 debut.

Intercontinental Exchange, the leading operator of global energy derivative exchanges and clearing houses, is planning to launch its oil future contract for liquefied natural exporter Abu Dhabi on March 29, backed by leading LNG sector players.

The exchange said that that trading on the ICE Murban Crude Oil Futures (IFAN) is going ahead subject to the completion of regulatory approvals

The IFAN futures debut in the markets had been delayed in 2020 by the market oil market slump and the Covid-19 pandemic.

“We are making good progress on securing the regulatory approvals necessary for launch. We have received approval from the Bank of England for ICE Clear Europe to clear contracts traded on IFAD and IFAD is now a Recognized Market Operator by the Monetary Authority of Singapore,” explained Jamal Oulhadj, President of ICE Futures in Abu Dhabi.

“We believe that the combination of our partners, ICE’s extensive global energy network and customer base, and the capital efficiencies created by clearing Murban alongside Brent, West Texas Intermediate, and Dubai, mean that Murban futures should have a deep base of support as the market uses the futures to buy, sell and hedge Murban crude,” added Oulhadj.

The Murban Crude Oil Future is a physically delivered contract, basis free-onboard (FOB) cargo at the Fujairah loading terminal in the UAE.

The contract will provide users with an effective hedging instrument for Arab Gulf crude oil and other grades of trading into the Asia-Pacific region.

Abu Dhabi also produces LNG as well as oil for the United Arab Emirates and is aiming to increase its natural gas resources by investing more in exploration and production in the next few years.

It currently produces around 5.8 million tonnes per annum of LNG at the Das Island liquefaction plant off Abu Dhabi.

In addition to the approvals from the Bank of England and Monetary Authority of Singapore, ICE Futures Abu Dhabi said it had completed the relevant regulatory processes or analysis required to permit direct access to IFAD from a range of jurisdictions including Abu Dhabi Global Market, the United States, Switzerland, the Netherlands, France, Norway, Australia, Japan and South Korea.

Contracts traded at IFAD will be cleared at ICE Clear Europe, a leading energy clearing house, and will clear alongside ICE’s global energy futures platform covering oil, natural gas and the environmental complex, allowing customers to benefit from associated margin offsets.

Inpex Corp., the Japanese oil and gas company with stakes in major LNG export plants and projects such as Ichthys and Prelude FLNG in Australia and Abadi LNG in Indonesia, is one of the companies that IFAD venture.

The other energy companies joining the launch of IFAD include Royal Dutch Shell, BP of the UK, PetroChina, Total, PTT of Thailand, Japan’s JXTG Nippon Oil & Energy and the international commodities traders Vitol.