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Description

The EU-Style Brent Option is based on the underlying ICE Brent Bullet Future (BNB) and will automatically exercise into the settlement price of the Bullet Future on the day of expiry of the options contract.

Market Specifications

Trading Screen Product Name

Crude Futures

Trading Screen Hub Name

Brent Euro Option (Cash Settled)

Contract Symbol

BUL

Hedge Instrument

The delta hedge for the EU-Style Brent Option is the ICE Brent Bullet Future (BNB)

Contract Size

1,000 barrels

Unit of Trading

Any multiple of 1,000 barrels

Currency

US Dollars and cents

Trading Price Quotation

One cent ($0.01) per barrel

Settlement Price Quotation

One tenth of one cent ($0.001) per barrel

Minimum Price Fluctuation

One tenth of one cent ($0.001) per barrel

Last Trading Day

Trading shall end three Business Days prior to the Expiration Date of the ICE Brent Crude Futures contract.

If the day on which trading in the relevant EU-Style Brent Option is due to cease would be either: (i) the Business Day preceding Christmas Day, or (ii) the Business Day preceding New Year’s Day, then trading shall cease on the next preceding Business Day

Option Style

Options are European-style and will be automatically exercised on the expiry day if they are “in the money”. The future resulting from exercise immediately goes to cash settlement relieving market participants of the need to concern themselves with liquidation or exercise issues. If an option is “out of the money” it will expire automatically. It is not permitted to exercise the option on any other day or in any other circumstances than the Last Trading Day. No manual exercise is permitted.

Expiry

19:30 London Time

Automatic exercise settings are pre set to exercise contracts which are one minimum price fluctuation or more “in the money” with reference to the relevant reference price. Members cannot override automatic exercise settings or manually enter exercise instructions for this contract.

The reference price will be a price in USD and cents per barrel equal to the settlement price of the underlying ICE Brent Bullet Future (BNB) for the contract month. For these purposes “settlement price” means the 3rd to last day prior to the LTD of the ICE Brent Crude Futures contract month. When exercised against, the Clearing House, at its discretion, selects sellers against which to exercise on a pro rata basis

Option Premium / Daily Margin

The premium on the EU-Style Brent Cash Settled Option is paid/received on the day following the day of trade. Option positions, as with Future positions, are marked-to-market daily giving rise to positive or negative realized potential variation margin flows. Once the premium is paid there is no additional variation or initial margin payable by the buyer of the option. All open contracts are marked-to-market daily. Initial Margin is payable by the buyer and seller of the option, but for the buyer the initial margin will not exceed the value of the premium paid. In addition, the buyer may use the value of the premium of an in-the-money option collateral against other ICE OTC and ICE Futures Europe margin obligations at ICE Clear Europe.

Strike Price Intervals

Minimum $0.50 increment strike prices. $1.00 Strikes from $20 to $240. $0.50 strikes 20 strikes above and below ATM. The at the money strike price is the closes interval nearest to the previous business day’s settlement price of the underlying contract.

Contract Series

Up to 36 consecutive months

Final Payment Date

Two Clearing House Business Days following the Last Trading Day.

Business Days

Publication days for ICE

MIC Code

IFEU

Clearing Venues

ICEU

Trading Hours

Codes