Register with us today

and in less than 60 seconds continue your access to:Latest news headlinesAnalytical topics and featuresCommodities videos, podcast & blogsSample market prices & dataSpecial reportsSubscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

In this list

ICE to launch 0.5% futures contracts Feb 4 ahead of IMO 2020 sulfur cap

Commodities | Energy | LNG | Natural Gas | Shipping | Containers | Tankers

Perfect Storms: Container and LNG shipping herald new year with all-time highs


Platts Dirty Tankerwire

Electric Power | Renewables | LNG | Infrastructure Utilities

Caribbean Energy Conference, 21st

Bunker Fuel | Oil | Refined Products | Fuel Oil | Shipping | Marine Fuels

Asia residual fuel market - Key market indicators this week

Commodities | Oil | Petrochemicals | Corporates

Insight Conversation: Christyan Malek, JP Morgan

ICE to launch 0.5% futures contracts Feb 4 ahead of IMO 2020 sulfur cap

London — The Intercontinental Exchange Thursday said it will launch 0.5% futures contracts in February in preparation for the global marine sulfur cap in 2020, settling against S&P Global Platts physical marine fuel 0.5% assessments.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

"[ICE] announced plans to launch new Marine Fuel 0.5% futures contracts in advance of the implementation of the 0.5% sulphur cap by the International Maritime Organization (IMO) in 2020," it said in a statement. "The new contracts are expected to launch on February 4, 2019, subject to completion of relevant regulatory processes."

The contracts will settle against Platts physical 0.5% assessments and include the following instruments; Fuel Oil Outright - Marine Fuel 0.5% FOB Rotterdam Barges (Platts) Future, Fuel Oil Outright - Marine Fuel 0.5% FOB Singapore (Platts) Future, Fuel Oil Diff - Marine Fuel 0.5% FOB Rotterdam Barges (Platts) vs 3.5% FOB Rotterdam Barges (Platts) Future, Fuel Oil Diff - Marine Fuel 0.5% FOB Singapore (Platts) Future vs 380 CST Singapore (Platts) Future, Fuel Oil Outright - Marine Fuel 0.5% FOB USGC Barges (Platts) Future, Fuel Oil Diff - Marine Fuel 0.5% FOB USGC Barges (Platts) vs USGC HSFO (Platts) Future.

The market has so far lacked a 0.5% hedging instrument and at present traders use ICE low sulfur gasoil futures, the fuel oil hi-lo spread -- the premium of 1% FOB NWE cargoes over 3.5% FOB Rotterdam barges -- and even crude futures to take positions in preparation for the IMO 0.5% sulfur cap.

"Our customers have expressed a strong desire for Marine Fuel 0.5% specific derivative contracts and our new contracts will allow market participants to hedge forward positions in an industry which today consumes more than three million barrels per day of high sulphur fuel oil," said Jeff Barbuto, Vice President of Oil Markets at ICE. "The contracts will operate alongside ICE's benchmark Low Sulphur Gasoil futures, fuel oil and LNG markets providing customers with a range of hedging tools to assist with the transition to the new regulations in 2020."

The move comes after the New York Mercantile Exchange said November 21 that it will list 11 marine fuel 0.5% futures contracts for trading on the CME Globex electronic platform from December 9, for trading from December 10. So far traders have been tentative in their approach to trading the instruments, saying they will wait for others to take the first position.

"[No one] wants to be the first to jump in there, it's the second mouse that gets the cheese," a fuel oil trader said this week.

Liquidity in 0.5% futures is as yet unclear, but traders point to increased activity through 2019 as more clarity has been provided, with physical demand for 0.5% marine bunker fuel likely to pick up towards the fourth quarter of next year.

Bunkering Portfolio Solutions

Platts Bunker Portfolio offers a unique mix of products, whatever your position in the bunker fuel supply chain. The combination of business intelligence you use is crucial: from breaking news to detailed market analysis, price assessments to in-depth credit reports.

More Information

--Eleni Pittalis,

--Tamara Sleiman,

--Edited by Jonathan Fox,