ICE Aligns Midland WTI (HOU) Crude Quality Specifications to Match U.S. Physical Gulf Coast Crude Cargoes
May 01 2024 - 7:30AM
Business Wire
Intercontinental Exchange, Inc. (NYSE: ICE), a leading global
provider of technology and data, today announced that its ICE
Midland WTI (ICE:HOU) futures contract is now further aligned with
Midland WTI crude oil deliverable into Dated Brent and the rest of
the Brent complex after ICE updated the quality specifications of
the crude deliverable into the contract.
The underlying crude oil quality of HOU futures now fully aligns
with the globally accepted quality standard for Midland WTI crude
after ICE added a maximum Iron content of 10 milligrams per
kilogram (mg/kg) and replaced the combined Nickel and Vanadium
maximum content with individual maximum contents of 2.0 mg/kg each.
In addition, the Reid Vapor Pressure (RVP) maximum increased to 9.5
pounds per square inch (Psi).
“This provides the market with the only transparent source for
exchange guaranteed Midland quality WTI,” said Jeff Barbuto, Global
Head of Oil Markets at ICE. “We continue to see strong growth in
volume and deliveries and are seeing increasing activity from
physical producers pricing barrels off of the HOU futures
price.”
HOU prices at, and is physically deliverable to, the Enterprise
Crude Houston (ECHO) and ONEOK Magellan East Houston (MEH)
terminals, which are connected to Platts-approved water terminals
to deliver Midland WTI into Brent.
Serving as a benchmark for Midland-origin and Midland-quality
crude production and exports, HOU futures hit record traded volume
in the first quarter of 2024 with over 837,600 contracts traded, up
over 200% year-over-year (y/y) with record average daily volume of
over 16,200 contracts in March 2024. Deliveries of Midland WTI
crude oil through the HOU contract average 4.4 million barrels each
month.
HOU is part of ICE’s global oil complex covering over 800
futures and options contracts, underpinned by Brent which is used
to price over three quarters of the world’s internationally traded
crude oil. Customers can benefit from margin offsets as high as 95%
when clearing HOU alongside other oil positions cleared at ICE,
with offsets across contracts including ICE Brent, ICE Gasoil, ICE
Dubai (Platts), ICE Murban, as well as RBOB Gasoline.
Brent futures and options open interest is up 12% y/y at 5.1
million contracts. Brent options, which represent the primary crude
oil options market in the world in terms of open interest and
volume, hit record open interest of 3.5 million contracts on April
24, 2024, up 51% y/y.
About Intercontinental Exchange
Intercontinental Exchange, Inc. (NYSE: ICE) is a Fortune
500 company that designs, builds and operates digital networks that
connect people to opportunity. We provide financial technology and
data services across major asset classes helping our customers
access mission-critical workflow tools that increase transparency
and efficiency. ICE’s futures, equity, and options exchanges
– including the New York Stock Exchange – and clearing
houses help people invest, raise capital and manage risk. We
offer some of the world’s largest markets to trade and clear energy
and environmental products. Our fixed income, data services
and execution capabilities provide information, analytics and
platforms that help our customers streamline processes and
capitalize on opportunities. At ICE Mortgage Technology, we
are transforming U.S. housing finance, from initial consumer
engagement through loan production, closing, registration and the
long-term servicing relationship. Together, ICE transforms,
streamlines and automates industries to connect our customers to
opportunity.
Trademarks of ICE and/or its affiliates include Intercontinental
Exchange, ICE, ICE block design, NYSE and New York Stock Exchange.
Information regarding additional trademarks and intellectual
property rights of Intercontinental Exchange, Inc. and/or its
affiliates is located here. Key Information Documents for
certain products covered by the EU Packaged Retail and
Insurance-based Investment Products Regulation can be accessed on
the relevant exchange website under the heading “Key Information
Documents (KIDS).”
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995 – Statements in this press release regarding
ICE's business that are not historical facts are "forward-looking
statements" that involve risks and uncertainties. For a discussion
of additional risks and uncertainties, which could cause actual
results to differ from those contained in the forward-looking
statements, see ICE's Securities and Exchange Commission (SEC)
filings, including, but not limited to, the risk factors in ICE's
Annual Report on Form 10-K for the year ended December 31, 2023, as
filed with the SEC on February 8, 2024.
Category: EXCHANGES
ICE- CORP
Source: Intercontinental Exchange
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version on businesswire.com: https://www.businesswire.com/news/home/20240501093628/en/
ICE Media Contact: Jess Tatham jess.tatham@ice.com
+44 7377 947136
ICE Investor Contact: Katia Gonzalez
katia.gonzalez@ice.com (678) 981-3882
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