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Description

The 3.5% FOB RDAM Barges Fuel Oil Average Price Option is based on the underlying 3.5% FOB RDAM Barges Fuel Oil Future (BAR) and will automatically exercise into the settlement price of the Swap Future on the day of expiry of the options contract.

Market Specifications

Trading Screen Product Name

Fuel Oil Futures

Trading Screen Hub Name

3.5% FOB Rdam Bg

Contract Symbol

BAR

Hedge Instrument

The delta hedge for the 3.5% FOB Rotterdam Barges Average Price Option is the 3.5% FOB Rotterdam Barges Swap Future (BAR).

Contract Size

1,000 metric tonnes

Unit of Trading

Any multiple of 1,000 metric tonnes

Currency

US Dollars and cents

Trading Price Quotation

One cent ($0.01) per metric tonne

Settlement Price Quotation

One tenth of one cent ($0.001) per metric tonne

Minimum Price Fluctuation

One tenth of one cent ($0.001) per metric tonne

Last Trading Day

Last Trading Day of the contract month

Option Style

Options are Asian-style and will be automatically exercised on the expiry day if they are "in the money". The Swap 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

16:30 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 metric tonne based on the average of the assessment prices of the Platts 3.5% FOB RDAM Barges Swap Future for the 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 3.5% FOB RDAM Barges Average Price Options are premium-paid-upfront options. The traded premium will therefore be debited by the Clearing House from the Buyer and credited to the Seller on the morning of the Business Day following the day of trade. Members who are long premium-paid-upfront options will receive a Net Liquidating Value (NLV) credit to the value of the premium which is then used to offset the initial margin requirement flowing from both these options and positions in other energy contracts. Members who are short premium-paid-upfront options will receive an NLV debit in addition to their initial margin requirement. NLV is calculated daily with reference to the settlement price of the option.

Strike Price Intervals

A minimum of 10 strikes above and below at the money in $1.00 increments will be listed at launch. This contract will support Custom Option Strikes with strikes in increments of $0.25 within a range of $150 to $900. These ranges may be revised from time to time according to future price movements. The at-the-money strike price is the closest interval nearest to the previous business day's settlement price of the underlying contract.

Contract Series

Up to 60 consecutive months

Final Payment Date

Two Clearing House Business Days following the Last Trading Day.

Business Days

Publication days for Platts European Marketscan

MIC Code

IFEU

Clearing Venues

ICEU

Trading Hours

Codes