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Abu Dhabi’s ADNOC begins derivatives trading

Abu Dhabi’s ADNOC begins derivatives trading

The new offices of ADNOC’s trading entities are located in Abu Dhabi’s International Financial Centre

ADNOC Trading (AT), a trading entity of Abu Dhabi National Oil Company (ADNOC), has started derivatives trading as a direct market participant, it announced on September 30.

Besides ADNOC Trading, which focuses on the trading of crude oil, ADNOC has also incorporated ADNOC Global Trading (AGT) a joint venture with ENI and OMV that will focus on the trading of refined products.

The new offices of both entities are located in Abu Dhabi’s International Financial Centre at Abu Dhabi Global Market (ADGM).

ADNOC Trading is now operational, while ADNOC Global Trading is establishing processes, procedures and systems to begin operations in the coming months. The AGT trading team is already optimising ADNOC’s flows (crude, feedstock and product optimisation).

ADNOC, by way of trading, will be able to offer a broader range of services to its customers and ensure added value through new revenue streams from the sale of its growing crude and refined products portfolio.

Dr. Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC group CEO, said: “This historic achievement is yet another important milestone for ADNOC as we become a more modern, agile and progressive energy company. Our steadfast focus is on providing a better service to our customers, while also stretching the margin from every barrel of oil that we produce, refine and trade. Our move into trading supports both of these goals.

“The opening of our trading offices at Abu Dhabi Global Market (ADGM) further reinforces its position and reputation as a leading and growing commodities trading hub for our nation and the Middle East region.”

Ahmed Ali Al Sayegh, UAE Minister of State and chairman of Abu Dhabi Global Market, added: “We congratulate ADNOC on the auspicious launch of their trading operations, and setting another major milestone as they continue to unlock new potential and opportunities to further the UAE economy. As an International Financial Centre, ADGM is committed to supporting ADNOC and Abu Dhabi institutions in their strategic development and future endeavours via our financial and business platforms.”

Safeguards are in place to oversee and track all trading activity. In order to manage and control risk, the expert trading teams use a suite of energy trading and risk management systems that cover the full life cycle of every trade. The establishment of ADNOC’s new trading entities is part of the company’s broader transformation in its customer-facing marketing, supply and trading directorate (MS&T).

ADNOC’s marketing arm is moving from a supplier that customers historically collected products from, to a more customer and market-centric, shipping and integrated logistics, storage and trading organisation.

In shipping, ADNOC Logistics and Services provides highly specialised services that cover the entire oil and gas supply chain. It is also expanding its merchant fleet in line with ADNOC’s growing upstream and downstream portfolio and the company’s move into trading.

In storage, in addition to substantial storage in the UAE and international storage in Japan and India, ADNOC announced a strategic investment in global storage terminal owner and operator VTTI BV (VTTI) last year.

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