GS Caltex Launches Abu Dhabi Crude Oil Futures Exchange with Global Companies

원본보기 아이콘

[Asia Economy Reporter Hwang Yoon-joo] GS Caltex has started Murban crude oil futures trading with global energy companies, aiming to activate crude oil trading with a transparent and fair price mechanism.

GS Caltex announced on the 30th that President Heo Se-hong attended the launch ceremony of the ICE Futures Abu Dhabi (IFAD), along with the Abu Dhabi National Oil Company (ADNOC) of the United Arab Emirates, the world's largest exchange group Intercontinental Exchange (ICE), and global energy companies.

In a pre-interview with IFAD, President Heo said, "With the launch of IFAD, a new chapter has opened where buyers can purchase Murban crude oil fairly and transparently," adding, "Murban crude oil will establish itself as a global benchmark price in the future."

The launch ceremony, held via video conference at the Abu Dhabi Global Market (ADGM), was attended online by representatives of global energy companies involved in establishing IFAD, including BP, Shell, Vitol, Petrochina, INPEX, and PTT. At the ADGM site where the ceremony took place, Mansour bin Zayed, Deputy Prime Minister of the United Arab Emirates, was present.

IFAD, which handles Murban crude oil produced in Abu Dhabi, determines crude oil prices based on prices traded on the futures exchange, similar to a stock market. Real-time trading is available for 22 hours a day (01:00 am to 11:00 pm London time), excluding a 2-hour daily break. Starting with the launch of IFAD, Murban crude oil futures trading began immediately, and physical delivery of crude oil futures will be pursued two months later, with the first physical shipment expected around June.

In particular, as the pricing method changes from being decided and announced by oil-producing countries to real-time trading on the exchange, price transparency is expected to increase significantly. From the buyer's perspective, rational and stable crude oil supply and demand will become possible.

Murban crude oil is used by more than 60 refineries worldwide and is the most widely used crude oil in Asia. The daily maximum production of Murban crude oil is 2 million barrels, accounting for more than 50% of the crude oil produced by ADNOC. Of the 260 million barrels of crude oil imported by GS Caltex last year, 34 million barrels were Murban crude oil, accounting for about 13%, the highest proportion for a single crude oil type. Additionally, GS Caltex’s parent company, GS Energy, participates in two onshore production blocks in the United Arab Emirates producing Murban crude oil, securing a production volume of approximately 560 million barrels over 40 years.

Meanwhile, GS Caltex participated in the 'IFAD Establishment Partnership Agreement' in Abu Dhabi in November 2019 and has continuously worked with the GS Caltex Abu Dhabi branch to ensure the smooth launch of IFAD. The GS Caltex Abu Dhabi branch, opened in May 2011, mainly handles long-term crude oil contracts with Middle Eastern oil-producing countries.

© The Asia Business Daily(www.asiae.co.kr). All rights reserved.