ICE’s Global Natural Gas Markets Reach Record Liquidity

Rhea-AI Summary

Intercontinental Exchange (NYSE:ICE) announced record liquidity across its global natural gas futures markets. Key highlights include:

- Global natural gas futures reached record open interest (OI) of 22.4 million contracts, up 15% year-over-year (y/y).

- U.S. Financial Gas futures and options hit record OI of 11.7 million contracts, up 13% y/y.

- TTF futures reached record OI of 2.1 million, up 53% y/y, with liquidity now extending to 2033.

- Henry Hub markets saw OI up 26% y/y.

- TTF options OI at 2.2 million contracts, up 86% y/y.

ICE's global energy markets OI is up 23% y/y at 59.2 million contracts, reflecting the increasing interconnectedness of global natural gas markets.

Positive

• Record open interest (OI) of 22.4 million contracts in global natural gas futures markets, up 15% year-over-year
• U.S. Financial Gas futures and options reached record OI of 11.7 million contracts, up 13% year-over-year
• TTF futures hit record OI of 2.1 million, up 53% year-over-year
• Henry Hub markets OI up 26% year-over-year
• TTF options OI at 2.2 million contracts, up 86% year-over-year
• Global energy markets OI up 23% year-over-year at 59.2 million contracts

Negative

• None.

Insights

Financial Analyst

ICE's record-breaking liquidity in global natural gas futures markets signals robust market activity and increased hedging needs. The 15% year-over-year increase in open interest to 22.4 million contracts indicates growing market participation and potentially higher volatility. This surge in liquidity could lead to more efficient price discovery and risk management opportunities for energy traders and companies.

The 53% year-over-year growth in TTF futures open interest is particularly noteworthy, reflecting Europe's evolving energy landscape and the increasing importance of natural gas in the region's energy mix. The extension of TTF futures to 2033 aligns with long-term planning horizons, potentially attracting more institutional investors and enhancing ICE's competitive position in the global energy derivatives market.

Market Research Analyst

The record liquidity across ICE's natural gas markets reflects the growing interconnectedness of global energy markets, driven by LNG liberalization. This trend is reshaping how market participants approach risk management and pricing strategies. The 86% year-over-year increase in TTF options open interest suggests a rising demand for flexible hedging instruments, possibly due to increased market uncertainty and geopolitical factors affecting European gas supply.

The expansion of ICE's U.S. Financial Gas markets to cover 70 hubs demonstrates the platform's adaptability to regional supply and demand dynamics. This granularity in market coverage could attract more specialized traders and improve overall market efficiency. The 23% year-over-year growth in ICE's global energy markets open interest further underscores the platform's dominant position in energy derivatives trading.

AMSTERDAM & HOUSTON & LONDON & NEW YORK--(BUSINESS WIRE)-- Intercontinental Exchange, Inc. (NYSE:ICE), a leading global provider of technology and data, today announced record liquidity across its global natural gas futures markets including record open interest (OI) in U.S. Financial Gas futures and options markets and record OI in TTF futures.

On August 27, 2024, ICE’s global natural gas futures markets reached record OI of 22.4 million contracts, up 15% year-over-year (y/y). In North America, ICE’s U.S. Financial Gas futures and options markets hit a series of OI records in August and September including a record 11.7 million contracts on September 3, 2024, up 13% y/y. ICE’s U.S. Financial Gas markets cover 70 hubs across North America allowing customers to manage regional supply and demand dynamics. Henry Hub markets, the U.S. natural gas benchmark, continues to see strong OI figures, up 26% y/y.

ICE TTF futures reached a series of OI records throughout August, including record OI of 2.1 million on August 29, 2024, up 53% y/y. TTF futures for Calendar year 2033 traded for the first time in August, meaning liquidity stretches out to 2033 in line with the U.S. benchmark Henry Hub, providing customers with the most liquid contracts globally to manage longer term exposure to natural gas prices. TTF options continue to see strong activity with OI at 2.2 million contracts, up 86% y/y.

“The increasing interconnectedness of natural gas around the globe, driven by the liberalization of LNG, has implications for natural gas trade, pricing and the way market participants think about risk. With this in mind, ICE has worked for over two decades to create a global platform for natural gas trading that supports globalization of the fuel,” said Trabue Bland, SVP, Futures Markets at ICE. “ICE has built the broadest and most liquid range of natural gas benchmarks for customers globally that are integral to efficient price risk management as supply and demand dynamics evolve.”

In addition to Henry Hub and TTF, ICE is home to the Canadian natural gas benchmark AECO, ICE’s U.K. natural gas benchmark NBP, and ICE JKM LNG (Platts), the benchmark price for natural gas for North-East Asia. ICE’s global natural gas portfolio is one part of its global energy markets which are the most liquid in the world to trade energy derivatives, with OI up 23% y/y at 59.2 million contracts.

About Intercontinental Exchange

Intercontinental Exchange, Inc. (NYSE: ICE) is a Fortune 500 company that designs, builds and operates digital networks that connect people to opportunity. We provide financial technology and data services across major asset classes helping our customers access mission-critical workflow tools that increase transparency and efficiency. ICE’s futures, equity, and options exchanges – including the New York Stock Exchange – and clearing houses help people invest, raise capital and manage risk. We offer some of the world’s largest markets to trade and clear energy and environmental products. Our fixed income, data services and execution capabilities provide information, analytics and platforms that help our customers streamline processes and capitalize on opportunities. At ICE Mortgage Technology , we are transforming U.S. housing finance, from initial consumer engagement through loan production, closing, registration and the long-term servicing relationship. Together, ICE transforms, streamlines and automates industries to connect our customers to opportunity.

Trademarks of ICE and/or its affiliates include Intercontinental Exchange, ICE, ICE block design, NYSE and New York Stock Exchange. Information regarding additional trademarks and intellectual property rights of Intercontinental Exchange, Inc. and/or its affiliates is located here . Key Information Documents for certain products covered by the EU Packaged Retail and Insurance-based Investment Products Regulation can be accessed on the relevant exchange website under the heading “Key Information Documents (KIDS).”

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 – Statements in this press release regarding ICE's business that are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of additional risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see ICE's Securities and Exchange Commission (SEC) filings, including, but not limited to, the risk factors in ICE's Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 8, 2024.

Category: EXCHANGES

ICE-CORP

SOURCE: Intercontinental Exchange

View source version on businesswire.com: https://www.businesswire.com/news/home/20240911940677/en/

ICE Media:

Jess Tatham

jess.tatham@ice.com

+44 7377 947136

ICE Investor:

Katia Gonzalez

katia.gonzalez@ice.com

(678) 981-3882

Source: Intercontinental Exchange

FAQ

What record did ICE's global natural gas futures markets reach on August 27, 2024?

ICE's global natural gas futures markets reached a record open interest (OI) of 22.4 million contracts on August 27, 2024, which is a 15% increase year-over-year.

How much did ICE's U.S. Financial Gas futures and options markets grow in September 2024?

ICE's U.S. Financial Gas futures and options markets hit a record open interest of 11.7 million contracts on September 3, 2024, representing a 13% increase year-over-year.

What was the growth in ICE's TTF futures open interest in August 2024?

ICE's TTF futures reached a record open interest of 2.1 million contracts on August 29, 2024, which is a 53% increase year-over-year.

How far out does liquidity in ICE's TTF futures extend?

Liquidity in ICE's TTF futures now extends to 2033, aligning with the U.S. benchmark Henry Hub and providing customers with long-term exposure management for natural gas prices.