ICE Announces Successful First Delivery of Russian-Free Barrels of ICE Gasoil

Source: 2/7/2023, Location: Asia

Intercontinental Exchange, Inc. (ICE), a leading global provider of data, technology, and market infrastructure, announced the first delivery of Low Sulphur Gasoil futures since Russian oil was excluded from the contract at the end of 2022.

Following extensive consultation with market participants, and in line with sanctions preventing the delivery or export of Russian oil in the European Union (EU) which took effect from February 5, 2023, ICE changed the methodology for Low Sulphur Gasoil futures from previously delivering diesel from any origin, to deliver diesel that does not include any originating from Russia. ICE Gasoil is the global benchmark for refined oil products.

A total of 69,800 tons entered the delivery process, with Gasoil delivered in the Amsterdam, Rotterdam, and Antwerp areas, in-line with the amount delivered in January 2022. Gasoil open interest is at 596,900 contracts, up 13% since the start of the year, with trading volumes up 40% in January 2023 versus December 2022.

“ICE worked closely with market participants and regulators to design a workable solution for our customers, so that they can confidently participate in physical delivery and trade Gasoil with the knowledge that the contract is EU sanctions compliant and fully representative of physical distillates flows,” said Jeff Barbuto, Global Head of Oil Markets at ICE. “It is encouraging to see customers engaging in the new, Russian-Free Gasoil contract through the delivery mechanism and on a financial trading basis.”

The ICE Low Sulphur Gasoil Futures contract has a successful 42-year history as a physically deliverable futures contract for what is now ultra-low sulphur diesel. The contract forms part of ICE’s global crude and refined product complex which includes Brent crude, the price barometer for approximately 80% of global crude, WTI, Midland WTI Gulf Coast (HOU), (Platts) Dubai, and Murban benchmarks. These provide the foundation for over 600 related oil products spread over multiple geographic markets, giving participants access to the products they need at the point of consumption or production.

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