| Name & Trade Code | Marine Fuel 0.5% FOB Singapore | |
| Contract Name: | Sing 0.5 Sprd (Fuel Oil), Time Spread, Asia -Commodity CFD | |
| Platform Code: | Sing 0.5 Sprd | |
| Deal Classification: | Commodity CFD | |
| Deal Type (Outright/Product Differential/Time Spread): | Time Spread | |
| Geographical Region: | Asia | |
| Specification | ||
| Category: | ||
| Sector: | Energy | |
| Price Digits: | 2 | |
| Product Group: | Fuel Oil | |
| Tenor Period: | Consecutive individual whole calendar months, e.g. February 25 (Feb25) | |
| Maximum Forward Tenor: | 12 consecutive forward Tenor Periods available | |
| Trading Screen Name: | Sing 0.5 Sprd | |
| Deal Type: | Time Spread | |
| Contract Size: | 100 | |
| Unit of Trading: | mt | |
| Currency: | USD | |
| Minimal Volume[Lots] (Lots * Contract Size = Total Deal Volume ): | 1 | |
| Maximal Volume [Lots] (Lots * Contract Size = Total Deal Volume ): | ||
| Volume Step: | 0.1 | |
| Settlement: | Last Trading Day and Expiry is the COB working day prior to start of the nearest contract month, please refer to Expiry Trading Overview below | |
| Trading Price Quote: | $/mt | |
| Underlying Settlement Price Reporting Agency (PRA): | Platts | |
| Expiry Trading Overview: | ||
| Contract Expiry Date: | The last working day of the month prior to the nearest expiring Tenor Period | |
| Last Trading Day (for new open positions): | ||
| Last Trading Day for closing position in that Tenor Period: | The Contract Expiry Date for the Tenor Period | |
| Tenor Period Settlement Valuation Process: | ||
| Open Volume | The net open volume for the Tenor Period | |
| Daily Settlement Value | Market-on-Close – The daily Underlying PRA assessment (Platts, Argus or Exchange) settlement assessment time, e.g. Singapore window for Singapore contracts or local PRA settlement time | |
| Daily Settlement Volume | All Open Volume will be closed and settled at Daily Settlement Value, with an MOC haircut applied | |
| Final Settlement Price | Last Trading Day and Expiry is the COB working day prior to | |
| MOC Haircut | +/- 50% of nominal OMGO spread |
The Sing 0.5 Sprd contract is a commodity CFD (Contract for Difference) in the Fuel Oil group that represents the time spread between two consecutive months of Marine Fuel 0.5% FOB Singapore prices.
Contract Purpose
This time spread contract allows market participants to:
- Speculate on or hedge against changes in the price relationship between two consecutive months of Marine Fuel 0.5% FOB Singapore
- Manage exposure to seasonal price fluctuations in the low-sulfur marine fuel market
- Execute calendar spread trading strategies
Market Significance
- Price Structure: Reflects the market’s expectation of near-term supply and demand dynamics for 0.5% sulfur marine fuel in Singapore
- IMO 2020 Impact: Captures the ongoing effects of the International Maritime Organization’s 2020 sulfur cap regulation
- Refinery Production: Indicates changes in refinery output and blending activity for compliant marine fuels
Trading Benefits
- Spread Risk Management: Allows traders to focus on relative price movements between months, reducing exposure to outright price volatility
- Market Access: Provides a tool for trading the time structure of the Singapore low-sulfur marine fuel market
- Flexibility: Enables various trading strategies, from simple calendar spreads to more complex multi-leg trades
This contract is particularly useful for shipowners, bunker fuel suppliers, refineries, trading houses, and financial institutions active in the Asian marine fuel market, offering them a precise instrument to manage time-related price risks and implement sophisticated trading strategies in the 0.5% sulfur marine fuel sector.
