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ICE moves energy futures to US in response to MiFID 2

First Published 16th January 2018

Intercontinental Exchange to move trading on 245 futures and options contracts from Europe to the US following stricter MiFID 2 regulations

In a circular to customers Intercontinental Exchange (ICE) said that on 19 February it will move trading on 245 futures and options contracts on North American oil and Natural Gas Liquids from London based ICE Futures Europe to ICE Futures US.

This means that trading will be (less strictly) overseen by the US Commodity Futures Trading Commission as opposed to European regulators.

The exchange operator said the decision followed its recent acquisition of US based energy commodities marketplace NGX, and addressed increasing customer demand for execution in certain North American energy contracts in the US.

Although ICE did not specifically state this, the growth in customer demand for US execution is thought to be attributable to the 3 January implementation of MiFID 2 in Europe. Intended to prevent any trader from having an excessive influence on the energy futures market in Europe, MiFID 2 imposes tighter position limits on contracts.

West Texas Intermediate, Brent, heating oil, and gasoil, ICE's biggest and most liquid contracts, will continue to be traded in Europe. Clearing of all futures and options, including those moving to the US, will remain in Europe.

List of oil and natural gas liquid contracts transitioning to ICE futures US