Latest: Murban crude futures start trading in Abu Dhabi

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Abu Dhabi National Oil Company and its international partners signalled a new era in crude trading following the launch of crude futures contracts tracking the UAE’s Murban grade.

Murban joins the ranks of Brent, the most widely-traded oil benchmark, and US gauge West Texas Intermediate in pricing and trading oil.

The Abu Dhabi grade, which flows at approximately 1.7 million barrels per day, accounts for half of the UAE’s production.

Murban fills a void in oil trading and pricing in the Middle East, which is the biggest supplier of crude to global energy markets.

The crude grade’s international role is supported by Adnoc’s recent removal of destination clauses in its trade.

The Abu Dhabi commodities exchange on which Murban crude futures will be bought and sold is operated by Intercontinental Exchange, also known as ICE.

The Ice Futures Abu Dhabi Exchange is supported by oil companies such as Thailand’s PTT, Japan’s JXTG and Inpex, BP, France’s Total, South Korea’s GS Caltex, PetroChina, Anglo-Dutch major Shell and Vitol.

Adnoc’s other crude grades, Upper Zakum, Das and Umm Lulu will be priced at a differential to Murban.

Murban was trading at $62.87 per barrel at 12pm UAE time, Intercontinental Exchange said on Twitter. Brent, the international benchmark, was down 0.93 per cent trading at $63.97 per barrel. WTI was down 1.28 per cent at $60.19 per barrel.

Sheikh Mansour bin Zayed, Deputy Prime Minister and Minister of Presidential Affairs, attended the launch of Murban crude futures trading at Abu Dhabi Global Market on Al Maryah Island.

Speaking ahead of the launch on Monday, Sheikh Saif bin Zayed, Minister of Interior and Deputy Prime Minister, said the trading of Murban crude futures “will enhance the position of the UAE capital as a leading and global energy centre”.

Murban crude futures launch a milestone for Adnoc and its partners

Dr Sultan Al Jaber, Minister of Industry and Advanced Technology, Adnoc managing director and group chief executive said at the launch the event is a milestone for Adnoc and its partners.

“This represents a significant milestone for Adnoc, ICE, our customers and of course our partners.

“Our new exchange IFAD will make ADGM even more global and we will establish Abu Dhabi as commodities trading centre.

“From today Abu Dhabi Murban will be freely traded, from Singapore to London and from Abu Dhabi to New York.

“Customers will be able to better manage risk and producers will get more value”.

“Murban came from humble beginnings, from one oil field in 1948 and 4,000 barrels … now it flows from 12,000 wells and 12 fields. Murban has become the crude of choice … particularly in Asia.”

It is chosen for its stability and “capacity to meet increased demand”.

Speaking at the launch, Ahmed Al Sayegh, Minister of State and executive chairman of ADGM, said the new commodities exchange at ADGM and Murban trading will “serve to boost liquidity [and] vibrancy to capital markets”.

“For international investors, this delivers greater and more efficient access to our region … it means doing more business closer to home,” he said.

Murban to become ‘globally recognised benchmark’

Jeffrey Sprecher, chairman of ICE, delivered a video message on “a truly historic day”.

‘We believe on its very first day Murban will become a globally recognised benchmark,” Mr Sprecher said.

“Adnoc will ring the opening bell of the New York Stock Exchange later to celebrate the day.”

The Abu Dhabi oil company will ring the opening bell at 5.30pm UAE time/9.30am New York time at NYSE.

Updated: March 29, 2021 01:02 PM