Vijay Valecha , Special to Gulf News 29, 2021
Abu Dhabi’s new commodity benchmark based on its flagship Murban crude is expected to become popular among Asian buyers, according to analysts.
The benchmark enjoyed a decent start to trading, opening at $63.45 a barrel compared with the S&P Platts closing assessment price of $62.40 a barrel on Friday.
“We see an uptake from Asia and, obviously, Middle Eastern [entities],” said Stephen Innes, chief global market strategist at broker Axi.
Murban, which accounts for half of Adnoc’s production, with outflows to Japan, China and India, could be a “great vehicle” for Asian refineries to hedge, he said.
So far, Middle Eastern crude has largely been priced using the Platts Dubai and Oman crude oil benchmarks.
The ICE Murban Crude Oil Futures contract will be based on a two-month delivery period, with the first contract for June delivery expiring at the end of April.
The June contract was up 0.8 per cent on volumes of 767,000 barrels a day, according to data from Intercontinental Exchange, which operates IFAD.
Contracts for July and August were also trading 0.85 per cent higher with volumes of 276,000 bpd and 183,000 bpd, respectively.
The establishment of IFAD, the Abu Dhabi Global Markets-based exchange on which Murban is traded, is backed by companies that include the UAE’s biggest oil customers in Asia.
“You are seeing big partners come in, including the likes of BP, Vitol ... PetroChina is involved ... [South Korea’s GS] Caltex, even Thailand’s PTT. This is a reflection in the quality of the code itself,” said Mr Innes.
Other partners within the futures exchange include Japan’s Eneos and Inpex, France’s Total and Anglo-Dutch company Shell.