Asia’s spot LNG benchmark goes digital with launch of electronic platform
Price agency S&P Global Platts and clearing house Intercontinental Exchange Inc said on Thursday they are launching an electronic platform known as eWindow to the liquefied natural gas (LNG) market.
Unlike oil, which has several liquid financial and physical trading platforms and exchanges, LNG markets are still evolving, with companies jostling to lead the space.
Platts, a unit of S&P Global Inc, uses the eWindow platform as part of its pricing process. The platform allows participating companies to key in their bids, offers or transactions directly and which appear on a screen for others to see.
It is aiming to launch the platform in a few months, said Ciaran Roe, global director of LNG at Platts.
Currently, participating companies wanting to bid, offer or transact, do so manually through a Platts editor.
The pricing agency already uses the digital platform for its oil benchmarks and is now extending it to its LNG price assessments, including the Platts Japan-Korea-Marker (JKM), which is fast becoming the benchmark price for spot LNG delivered into Northeast Asia.
The JKM LNG Platts contract on ICE hit a record 44,394 lots for futures and options combined in June and reached a new open interest record of 52,080 lots at the end of June, the companies said.
“As LNG markets continue to liberalize and new types of price agreements emerge between buyers and sellers of LNG, a range of hedging products are critical to allow the market to hedge risk and manage price exposure,” they added.
Rising spot trading volumes have attracted several companies to launch LNG pricing and trading platforms, including Australia-headquartered Global LNG Exchange and Spark Commodities which is jointly owned by data firm Kpler and energy exchange Powernext.
Source: Reuters (Reporting by Jessica Jaganathan; Editing by Rashmi Aich)