Oil & Gas

UAE’s Murban crude futures trade at record high

July 8, 2024, 1:19 PM

Tugboats at work with an oil tanker in Fujairah, from which Adnoc's Murban crude is delivered

Murban futures volumes up 160%
Adnoc increasing production
Murban has lower emissions

Murban crude, the UAE’s flagship oil grade, has reported a record jump in trading activity in the second quarter of this year, according to operator the Intercontinental Exchange (ICE).

Murban, the premium-grade light, sweet crude, is extracted from the onshore concessions of Abu Dhabi state oil company Adnoc and represents more than half of the UAE’s total oil production, or about 2 million barrels per day (bpd).

ICE Murban Futures are physically delivered contracts. That is, one futures contract equates to 1,000 barrels of Murban crude oil delivered from the Adnoc Terminal in Fujairah, on a specific date for a specific price – regardless of the price on the settlement date.

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The ICE Murban Futures market reached volumes of 1.5 million contracts, equivalent to 1.5 billion barrels of crude, between April and June this year, up by more than 160 percent since the beginning of 2024.

Murban is touted as one of the lowest carbon-emission crude oils in the world. Its carbon intensity amounts to 7kg of CO2 equivalent per barrel of oil equivalent, which is less than half the global average, according to Adnoc.

Adnoc plans to increase the production of Murban to more than 2.5 million bpd by 2030, in line with its goal to grow production capacity to 5 million barrels of crude per day.

Murban exports averaged 1.636 million bpd in April after an eight-year high of 1.644 million bpd in February, according to S&P Global Commodities at Sea data.

Murban futures trading was launched in March 2021 on ICE Futures Abu Dhabi (IFAD) at Abu Dhabi Global Market, part of Adnoc’s plan to increase Murban’s liquidity.

Murban is part of ICE’s global oil complex covering more than 800 futures and options contracts, centred on Brent, which is used to price more than three-quarters of the world’s internationally traded crude oil.

Since the launch of Abu Dhabi’s exchange, about 7.4 billion barrels of Murban crude oil have been traded, and 267 million barrels of Murban have been delivered through it.

IFAD is backed by Adnoc and nine oil companies: BP, GS Caltex, Inpex, JXTG, PetroChina, PTT, Shell, TotalEnergies and Vitol. To date, more than 160 participants from across Asia, the US, Europe and the Middle East have traded on IFAD.