Intercontinental Exchange Inc. (ICE) is extending the forward curve for Dutch Title Transfer Facility (TTF) natural gas futures by more than 18 months following record levels of interest and strong trading activity.
The TTF Gas Futures curve currently goes out to May 2029, with open interest to December 2028. ICE said Wednesday the forward curve has been extended effective Monday (June 21) to December 2031 following requests from customers.
The virtual pipeline hub in Northwest Europe is used to price some liquefied natural gas (LNG) deals throughout the region. There has seen record open interest levels in recent months as the LNG market has gotten tighter. ICE said TTF futures once again hit record open interest of 1.96 million contracts on June 10, up 20% year/year.
“Natural gas has become a global market and the record levels of open interest and strong trading activity in TTF reflect how it is at the forefront of global natural gas price formation,” said ICE’s Gordon Bennett, managing director of Utility Markets. “The requests from customers to increase the forward curve for TTF futures to 2031 has been driven by their need to be able to hedge global gas price risk and further optimize their LNG portfolios.”
Some quarterly, seasonal and calendar contracts, as well as time spreads, would be available to December 2031.
“The length of the curve is an important component particularly for commercial hedgers who use TTF futures to manage their risk,” ICE said. “The extension of the futures curve aligns the TTF gas futures contract close to the typical lengths of medium- to long-term deals between LNG buyers and sellers. This in turn allows market participants to manage long term risk related to these deals through the futures market.”
ICE also reported strong open interest in Japan-Korea Marker futures and options, which are currently up 9% at 111,800 lots.
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