IPE Volumes Break Records

Volumes of trade at the IPE reached their highest levels in the eighteen year history of the exchange on Friday. A total of 180,260 lots were traded over the day as oil prices moved sharply lower. The bearish mood was fuelled by rumours that compliance with Opec production ceilings had begun to wane and prompt Brent Crude prices fell by $1.38/bl from the previous day to close at $20.70/bl, the sharpest downward movement this year. Gas Oil futures were also affected and the front month October contract closed $11/t lower. The volume of oil traded was equivalent to 164 million barrels, or more than double total world daily oil consumption. Natural Gas futures volume equated to 27 million therms, or over a third of total UK daily consumption. The previous Exchange daily trading record of 171,655 lots was set on 11 May 1999. Overall this year has been exceptionally busy. Volumes are currently running at nearly 20% above the same period last year, and 70% above 1997 levels. Last month was the second busiest ever recorded with over 2 million lots traded. Richard Ward, chief executive of the IPE, said: "We are enjoying a tremendous year, with volumes continuing to grow, and new records being set regularly. Price volatility is demonstrating to those that have an interest in the price of energy that hedging can assist them to manage this risk".