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Description

The USGC HSFO (Platts) Average Price Option is based on the underlying USGC HSFO (Platts) Future (RBO) and will automatically exercise into the USGC HSFO (Platts) Future (RBO) on the day of expiry of the options contract.

Market Specifications

Trading Screen Product Name

Fuel Oil Futures

Trading Screen Hub Name

USGC HSFO (Platts)

Contract Symbol

RBO

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

Last Trading Day of the contract month

Option Style

Options are average priced and will be automatically exercised into the USGC HSFO (Platts) Future 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

Option Premium / Daily Margin

The USGC HSFO (Platts) Average Price Option is a premium-paid-upfront option. 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.

Expiry

19:30 London Time (14:30 EST).

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 average of the settlement prices of the USGC HSFO (Platts) 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

Strike Price Intervals

A minimum of 10 Strike Prices in increments of $0.01 per bbl above and below the at-the-money Strike Price. Strike Price boundaries are adjusted according to futures price movements. User-defined Strike Prices are allowed in $0.01 increments.

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 US Marketscan

MIC Code

IFED

Clearing Venues

ICEU

Trading Hours

Codes