ICE to Launch LNG Freight Futures Based on Spark Commodities’ Assessments in Key Milestone for Global Natural Gas Markets
New contracts will sit alongside ICE’s fast-growing TTF and JKM LNG (Platts) benchmarks
TTF Futures OI +29% y/y; JKM LNG (Platts) Futures and Options OI +37% y/y
LONDON & SINGAPORE (STL.News) Intercontinental Exchange, Inc. (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of mortgage technology, data, and listings services, announced today that it plans to launch LNG freight futures contracts based on Spark Commodities’ (“Spark”) price assessments, marking a milestone in the evolution of the LNG market.
These new contracts – called the Spark30S Atlantic and Spark25S Pacific LNG Freight Future contracts – are traded and settled in USD per day. The numbers in the contract names indicate the number of days it takes an LNG vessel to complete a return voyage on the respective routes. The settlement price of the contracts are based on the Spark30S (Atlantic) and Spark25S (Pacific) LNG freight spot price assessments. Market participants can use the contracts to manage price risk in respect of round-trip voyages between the US Gulf Coast and northwest Europe (Spark30 assessment); and Australia and Japan, Korea, Taiwan, and China (Spark25 assessment).ICE plans to launch these cash-settled futures contracts on March 22, 2021, subject to regulatory approval.