Argus is set to launch what it describes as “the world’s first” listed delivered bunker fuel derivatives contract later this month.
The Singapore Fuel Oil Bunker 380cst (Argus) Futures with contract code ABF will settle on the monthly average of Argus high-sulphur fuel oil (HSFO) 3.5pc delivered bunker assessments.
New York Mercantile Exchange (NYMEX) will list the futures contract for trading on the CME Globex electronic platform and for submission for clearing via CME ClearPort from 26 August 2019.
“Bunker premiums in Singapore have become increasingly volatile and are expected to remain so because of the implementation of IMO 2020,” said Argus.
“This new derivative product can help manage the risk of disconnection between cargo and delivered bunker markets.”
Argus said its bunker assessments reflect the cost of marine fuel delivered to vessels “in line with the needs of the maritime industry”.
For Singapore these are based on a volume-weighted average of reported deals up to 19:00.
Argus said a total of 2,395 deals were reported by market participants into the Singapore assessment process during the first half of 2019, an average of 20 each day.
“This assessment reflects the price paid for HSFO stems between 500t and 3,000t delivered to ship 4-12 days from the trade date,” it said.
