Euronext Energy

Discussion in 'Commodity Futures' started by uncleTom, Jan 2, 2007.

  1. Are there energy contracts listed in Europe?
     
  2. I'm not sure what you're asking.

    Almost all energy contracts are denominated in US Dollars and all the pit trading is in the US and most of the electronic trading is in the US, with some electronic trading nominally in the UK.

    The UK trading is on the Intercontinental Exchange (ICE) which is monitored by the British FSA, but it is an Atlanta based company. They purchased the International Petroleum Exchange in London a few years ago and turned it electronic. Specifically the Brent crude contract, and the British Natural Gas contract are traded on ICE. The British Natural Gas contract is denominated in pound sterling. In reality all ICE trading on a bank of computers in Atlanta (hence why the NYMEX was upset that ICE is FSA-regulated rather than CFTC-regulated, the Brits are a bit more relaxed when it comes to derivatives and futures regulation, e.g. no Commitment of Trader reports and the trading really occurs in Atlanta rather than London).
     
  3. contango

    contango

    From a regulatory point of view, the trading occurs where the traders are.

    As for Europe, there is:
    ICE - Brent, NBP, Zeebrugge, Power & Emissions....
    EEX - Power and Emissions (mostly German)
    ENDEX - Dutch & Belgian Power & Gas
    Euronext - no energy contracts but they do quote spark & dark spreads...

    There is also the Nordpool for Nordic power. For coal, there is globalCOAL. Nymex also offers their crude contracts in London.

    For tanker freight FFA's there is Imarex.

    However, most markets trade OTC via the brokers.... TFS, Spectron, GFI, ICAP etc...

    So yes, you could say there are energy contracts listed in Europe.
    :)
     
  4. Touche on EEX and ENDEX.

    Considering where the energy hedge funds are located, does that mean the regulation is 70% US 20% London 10% elsewhere for ICE?

    How does one even determine where the traders are? The hedgers are probably in the UK for UK Gas, but what about Brent crude?

    There are no IPE/ICE pits in London anymore and one trades screen on ICE from anywhere, so what does that mean, where the traders are?

    ICE's floor (for soft commodities at least) is now going to be in NY. How is that going to work, regulation wise?
     
  5. contango

    contango

    I think ICE is regulated by the FSA as a RIE (Recognised Investment Exchange) which governs basic rules of operation. However, each trading company / hedge fund etc. will generally be regulated by domestic authorities as well. This is what I meant to say by referring to where the traders are. Private individuals can gain access through a European broker such as Sucden or GNI Touch, the brokers themselves being regulated by the FSA.