Intercontinental Exchange, Inc. (NYSE: ICE), a leading global provider of data, technology, and market infrastructure, today announced that ICE Midland WTI American Gulf Coast futures (contract code: HOU) went to its first expiry on February 23, with 1,395 contracts going to expiry, equivalent to 1.4 million barrels, for delivery in March.
Since the contract began trading on January 24, over 12,000 ICE Midland WTI AGC futures have traded, equivalent to 12 million barrels of Permian Basin originated WTI crude oil. Open interest is 3,576 contracts and goes out to January 2023.
“It’s early days still but HOU is off to a great start,” said Jeff Barbuto, Global Head of Oil Markets at ICE. “We’ve seen some encouraging developments in the physical space, with cargos being offered based on HOU pricing, EFPs taking Midland WTI to the water, and general market engagement in exploring different ways to use HOU for pricing exposure, exporting, and managing risk around Midland WTI.”
The Exchange for Physical (EFP) mechanism allows participants to exchange a HOU futures position for the equivalent number of underlying physical Midland WTI barrels.
The contract is deliverable at both Magellan Midstream Partners’ Magellan East Houston (MEH) terminal and Enterprise Products Partners L.P.’s Enterprise Crude Houston (ECHO) terminal. To further facilitate trading between the MEH and ECHO terminals to create one large liquidity pool, Magellan and Enterprise will transfer Midland WTI barrels between the terminals for no charge during the first year if the barrels are not delivered to the buyer’s preferred terminal, and at 10 cents per barrel for all other WTI transfers meeting HOU quality specifications.
