Indiana Grain Company, LLC

Posted: 12/13/11

By: tomgrisafi

CME Group Inc. Monday launched a new Brent crude futures and options contract in a bid to challenge IntercontinentalExchange Inc.'s (ICE) dominance in the market, Dow Jones Newswire reported.

The first tradable month on CME's Brent 25-day contract will be Feb 2012, while the first month for ICE's Brent NX contract is December 2012.

"On the new contract at least they could start with a little more liquidity than in the ICE contract," said Olivier Jakob, managing director of Swiss consultancy Petromatrix.

"But I still think it's always the same when you launch a new futures contract. Liquidity is in the old contract and it takes a while to move to the new one," he added.

The ICE's decision to have the first trading month of its new contract a year out followed a period of consultation with customers, the exchange said.

"ICE Futures Europe believes that the end of 2012 is the earliest that the Brent market could change to a 25-day basis expiry calendar," a spokeswoman for the ICE said. "This is because it is important to ensure a full year's notice for Brent market participants, including those in the swaps (OTC) market."

Source: Dow Jones

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