Intercontinental Exchange, Inc. (NYSE: ICE), a leading global provider of data, technology, and market infrastructure, today announced that Enterprise Products Partners L.P. (NYSE: EPD) and ONEOK, Inc. (NYSE: OKE) have extended their fee waiver arrangement between the Enterprise Crude Houston (“ECHO”) and Magellan East Houston (“MEH”) terminals to transfer crude oil delivered through ICE’s Midland WTI futures contract (ICE: HOU) until December 31, 2025.
HOU futures had a record third quarter in 2023 with 672,681 contracts traded, with record average daily volume of 10,677 contracts. Each month, the HOU futures contract delivers approximately 5 million barrels of Midland WTI-quality crude. HOU has delivered approximately 71 million barrels of Midland WTI-quality crude since early 2022. Midland WTI crude oil also became deliverable into Dated Brent and the rest of the Brent complex earlier this year.
"Extending the fee waiver for customers to move Midland WTI barrels they acquire through the HOU contract to the terminal of their choosing provides additional incentive to manage their Midland WTI exposure with the HOU contract," said Jeff Barbuto, Global Head of Oil Markets at ICE. "Open interest has spread down the curve to the end of 2025 and this additional optionality should really add to the development of this market."
Customers can benefit from margin offsets as high as 95% when clearing HOU alongside other oil positions cleared at ICE Clear Europe, with offsets across a range of 700 oil contracts, including ICE Brent, ICE Gasoil, ICE WTI, ICE Dubai (Platts), ICE Murban, as well as RBOB Gasoline.
If customers take an HOU futures position to delivery, the seller will dictate the terminal the barrels are delivered to and the buyer can submit a terminal preference. In the event the buyer is not matched at their preferred terminal, the buyer can transfer their barrels between the MEH and ECHO terminals at no cost. The waiver also applies to customers who take delivery of HOU via ICE’s Exchange for Physical (EFP) and Alternative Delivery Procedure (ADP) mechanisms. If the buyer executes an EFP or ADP with a seller at a non-preferred terminal, the buyer may transfer the barrels to the other terminal at no cost. Currently, a 10-cent per barrel charge is applied for all other transfers of HOU-quality WTI between the ECHO and MEH terminals.
ICE offers customers the most liquid global energy markets in the world to manage risk exposure, with open interest hitting a record 52.6 million contracts on November 23, 2023, up 19% year-over-year. ICE’s global oil complex covers approximately 700 futures and options contracts, centered around ICE Brent which is used to price over three quarters of the world’s internationally traded crude oil and is the most liquid crude oil futures and options market in the world.