SGX 380-cst contract gets green light in the US

Market participants in the US are given the go-ahead to trade the SGX Fuel Oil 380-cst futures contract.



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Updated on 18 Feb 2010 10:41 GMT

Singapore Exchange (SGX) has announced that market participants and institutions in the United States (U.S.) will be allowed to trade the SGX Fuel Oil 380cst futures contract.

The news follows confirmation by the U.S. Commodity Futures Trading Commission (CFTC) that it has no objection to the contract being offered and sold in the U.S.

The CFTC’s decision is set to significantly strengthen the appeal of the contract for traders and investors in the international marketplace.

The new SGX Fuel Oil 380cst futures contract will begin trading on Monday, 22 February 2010 at 2.30pm (Singapore time).

Thereafter, the trading session for the new contract will run from 9.30am to 6.30pm Singapore time (T-session) and then from 7.30pm to 1.00am (T+1 session).

The extended trading hours will aim to provide participants, such as bunker suppliers, trading and shipping companies, with a transparent and efficient pricing mechanism for the Singapore fuel oil market.

A Summary of the Contract has been provided below:

Trading Unit - 100 tonnes (1 lot)

Contract Months - 12 consecutive months

Minimum Deliverable Size - 20 lots

Delivery Method

1. FOB SGX Designated Approved Installations, Singapore; and/or

2. Inter-tank transfer at SGX Designated Approved Installations, Singapore

Exchange Delivery Settlement Price

Daily Settlement Price on the Last Trading Day

Trading Hours

T Session:

Pre -Opening 9.15 am - 9.28 am
Non -Cancel Period 9.28 am - 9.30 am
Opening 9.30 am - 6.30 pm

T+1 Session:

Pre -Opening 7.15 pm - 7.28 pm
Non -Cancel Period 7.28 pm - 7.30 pm
Opening 7.30 pm - 1.00 am

Daily Price Limit:

An initial price limit of +/- 15% from the latest daily settlement price shall be in force. If the price reaches the initial price limit, a 15-minute cooling off period shall come into effect where trading at or within the price limit of 15% is allowed.

Following the cooling off period, the final price limit of +/-20% from the latest daily settlement price shall come into force. If the price reaches the final price limit, a second 15-minute cooling off period shall come into effect where trading at or within the price limit of 20% is allowed.

Following the second cooling off period, there will be no price limits for the rest of the trading session.

There shall be no price limits on the Last Trading Day for the expiring contract.

Position Limit

10,000 lots net long or net short for all Contract Months combined
8,000 lots net long or net short for any individual Contract Month
4,000 lots net long or net short in the front Contract Month.