IPE Fuel Oil Futures Go Live Tomorrow

Tomorrow will see the launch of the IPE's Fuel Oil futures contract, the new risk management tool designed for the oil and shipping industries. The contract has been developed with the assistance of IPE Members and industry over a nine-month period, who met at regular working group meetings during that time. The contract will be traded through open outcry from within the Gas Oil pit between 09.05 and 17.05 London time. The contract is designed around bunker specification fuel oil (for use in ships) and is based on the 3.5% sulphur FOB Rotterdam barge market. The contract size will be 100 tonnes and the minimum price fluctuation will be 5 cents/tonne. The forward range of the contract will be up to three years, consisting of 12 consecutive months, followed by four quarters and then two halves. The first deliverable contract will be October 1999, which will expire on 12 October. Richard Ward, Acting Chief Executive said, "There is widespread confidence within the industry and the IPE Membership that the time is now right to launch the Fuel Oil futures contract. I would like to take this opportunity to thank everyone who has made a contribution to its design and who will ensure that it is successful once trading begins on Friday".