Abu Dhabi’s state-owned oil and petrochemicals company, ADNOC, and the Intercontinental Exchange (ICE), the commodity and futures trading platform that also owns the New York Stock Exchange, officially launched a landmark new energy contract indexed to oil produced in the United Arab Emirates. The futures contract, Murban, made its official debut on Monday on the new ICE Futures Abu Dhabi (IFAD) commodities exchange.
ADNOC hailed the launch of the Murban futures contract as a step in its “ongoing transformation into a more market and customer-centric organization,” per a company announcement.
Murban is a freely traded crude, similar to Brent or WTI crude oil, providing better price transparency for clients, the flexibility to hedge exposures and manage risks, and increased access to Murban crude. For ADNOC, its flagship crude grade becomes more available to a broader set of market participants around the world.
“This is a historic moment for ADNOC, Abu Dhabi, and the UAE as we celebrate the launch of the IFAD exchange with ICE and, with our partners, capitalize on the growing demand for high-quality Murban crude oil, particularly from markets in Asia,” said H.E. Dr. Sultan Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC Managing Director and Group CEO. “This achievement is testament to the vision and foresight of our wise leadership, who have supported this progressive step that makes Murban crude a freely traded commodity that is more widely available to buyers and traders around the world.
“The launch of the world’s first Murban Futures contract makes our largest crude grade even more attractive to the global market, enabling ADNOC’s customers and market participants to better price, manage and trade their purchases of Murban. Murban Crude is recognized the world over for its intrinsic chemical qualities, consistent and stable production volumes, large number of international buyers, and numerous long-term concession and production partners. In making Murban a freely traded global commodity, it becomes even more attractive to market participants and will deliver greater value to ADNOC and its partners. This historic and strategic milestone reinforces the UAE and Abu Dhabi’s status as a leading global energy hub and underscores ADNOC’s central role as a catalyst to empower the UAE’s economic ambitions,” he said.
Nine of the world’s largest energy companies and traders have joined ICE and ADNOC as founding partners of the new exchange IFAD, including BP, GS Caltex, INPEX, ENEOS, PetroChina, PTT, Shell, Total and Vitol.
ICE Murban Futures are physically delivered contracts, with one futures contract equal to 1,000 barrels of Murban crude oil delivered from the ADNOC Terminal located in the emirate of Fujairah, on the UAE’s eastern coast. Murban is ADNOC’s flagship crude grade, with production capacity of over 2 million barrels per day at present. It currently accounts for around 50% of the UAE’s total production capacity, with plans in place to increase the production of Murban to more than 2.5 million barrels per day by 2030, in line with ADNOC’s goal of growing its production capacity to 5 million barrels of crude per day.
Earlier this month, ADNOC announced that Murban, as well as the Emirates’ Upper Zakum, Das and Umm Lulu regional crude grades will all be sold destination-free, as of June 2021, allowing its crude oils to become a freely-traded commodity.
Murban Futures will trade globally on the ICE platform, and clear through ICE Clear Europe, based in London. As of today, Murban now trades alongside ICE Brent and ICE WTI in the ICE network.
