Record-breaking trading activity for UAE's Murban Crude
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Record-breaking trading activity for UAE’s Murban Crude

Record-breaking trading activity for UAE’s Murban Crude

The platform’s extensive reach allows investors from multiple jurisdictions to participate in trading the Murban Crude oil futures

Marisha Singh

The UAE’s Murban Crude has seen record-breaking trading activity, announced Intercontinental Exchange (NYSE: ICE), in the second quarter of 2024. ICE Futures Abu Dhabi (IFAD), the platform where Murban futures are traded, saw an unprecedented surge in trading volumes, underscoring the growing importance and demand for the UAE’s flagship crude grade, reported state news agency WAM. .

IFAD and ICE’s Murban futures market were launched in Abu Dhabi in March 2021.

The launch was a collaborative effort involving ADNOC (Abu Dhabi National Oil Company) and nine of the world’s largest energy traders, including BP, GS Caltex, Impex, Eneos, PetroChina, PTT, Shell, TotalEnergies, and Vitol. This partnership as well as the fundamentals underpinning the Murban Crude oil futures, set the stage for it to become a key player in the global oil market.

Trading volumes

During the second quarter of 2024, the Murban futures market witnessed a record trading volume of over 1.5 million contracts, equivalent to 1.5 billion barrels of Murban crude, added the WAM report.

This marks an increase of over 160 per cent since the start of the year. The growing figures highlight the increasing confidence and reliance of traders on Murban crude as a stable and valuable commodity.

In June alone, Murban futures set multiple daily trading records, including a peak of 57,300 contracts traded on June 10, equivalent to 57.3 million barrels, as per the WAM report. The average daily volume for Murban futures in June also reached a new high of 31,000 contracts, or 31 million barrels.

Since its inception, IFAD has facilitated the trading of 7.4 billion barrels of Murban crude oil, with 267 million barrels physically delivered through the exchange, added the WAM report.

The platform has attracted over 160 participants from across the globe, including Asia, the US, Europe, and the Middle East. These participants range from commercial entities to financial institutions, indicating broad-based acceptance and utilization of Murban futures.

Appeal of Murban Crude

Murban crude, supplied by ADNOC, is attractive for its low carbon density, making it one of the most preferred crude oils available, as companies address their carbon footprint in a world impacted by climate change. This premium-grade, light, sweet crude is particularly popular among Asian buyers, who dominate the global oil trade.

In April 2024, Murban exports averaged 1.636 million barrels per day, with an all-time high of 1.644 million barrels per day recorded in February. ADNOC has projected that Murban crude exports will reach 1.65 million barrels per day by April 2025.

The UAE has a production capacity of 2 million barrels per day for Murban, with the majority of exports (75 per cent) being handled through the Fujairah port, and the remainder through the Ruwais port.

The high trading figures come in the backdrop of OPEC and its allies extending their deep oil output cuts into 2025.

OPEC+ agreed to extend the cuts of 3.66 million bpd by a year until the end of 2025 and prolong the cuts of 2.2 million bpd by three months until the end of September 2024.

Market access

IFAD’s Murban futures are available for trading 24 hours a day on Mondays and 22 hours a day from Tuesday to Friday.

The platform’s extensive reach allows investors from jurisdictions including ADGM (Abu Dhabi Global Market), the US, Singapore, the UK, Switzerland, the Netherlands, France, Norway, Australia, Japan, and South Korea to participate in trading.

ICE’s global commodity markets, encompassing over 800 futures and options contracts, including benchmark oil and natural gas contracts, also saw record trading activity in the second quarter of 2024, with over 305 million contracts traded.

This broader success reflects the overall robustness and growth of ICE’s commodity trading platforms.

The record trading volumes of Murban crude on IFAD underscore the significant strides made by the UAE in establishing itself as a key player in the global oil market.

Read: Hot summer in the crude oil market as Saudi Arabia’s production cuts kick in

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