ICE enhances Permian WTI crude futures contract options

By Intercontinental Exchange Inc. | January 22, 2019

Intercontinental Exchange Inc., an operator of global exchanges and clearing houses and provider of data and listings services, has enhanced its ICE Permian WTI crude oil futures contract. 

Upgrades include: 

New Delivery Terminals: To provide customers with options to take delivery of Permian WTI quality crude on the water, Magellan Midstream Partners L.P.’s Galena Park terminal and the Seabrook Logistics terminal jointly owned by Magellan and LBC Tank Terminals LLC will be added as new delivery locations in the Houston area for the contract, effective later this quarter, subject to relevant regulatory processes. Other marine terminals are also being considered as delivery points for the contract, subject to certain quality requirements. 

Crude Storage Futures: Pending regulatory approval, ICE plans to launch ICE Permian WTI Crude Oil Storage Futures, deliverable at Magellan’s terminal in East Houston, Texas. ICE Permian WTI Crude Oil Storage Futures are expected to be listed on ICE Futures Europe and represent the right to store 1,000 barrels of Permian WTI crude oil at MEH. 

New Metals Data: Beginning later this month, new data showing the levels of metals, such as Nickel, Vanadium and Iron in Permian WTI, will be added to this report, which is published on ICE’s website. Magellan’s shipping and storage facilities are recognized throughout the industry for their consistent high quality, and this expanded reporting will provide additional assurance to customers around the world about the reliability of quality of WTI delivered against ICE’s Permian WTI Futures contract. 

“We’re excited about these enhancements to the Permian WTI futures contract,” said Jeff Barbuto, ICE’s global head of oil sales and business development. “Our customers have expressed interest in getting MEH-quality crude delivered directly to highly efficient export facilities. With these additional delivery options, new crude storage futures and unprecedented quality transparency, as well as futures spreads between Permian WTI, ICE Brent, ICE WTI and ICE Dubai, we’re offering a full suite of global crude oil risk management and trading solutions to our customers.”

“We are pleased the ICE Permian futures contract has consistently grown since its introduction last fall,” said Mark Roles, Magellan’s vice president of commercial crude oil. “The addition of physical delivery points at Galena Park and Seabrook Logistics along with the quality of the WTI distributed from these facilities provides customers with significant flexibility for domestic and export opportunities.”

ICE is home to the world’s global crude and refined oil markets. Around half of the world’s oil futures are traded on ICE’s markets, including futures and options on the global benchmark ICE Brent crude, the U.S. benchmark West Texas Intermediate (WTI) crude, the Middle Eastern and Asian benchmark ICE Platts Dubai crude oil, Gasoil, Heating Oil and RBOB Gasoline, as well as hundreds of additional grades and oil products.