The two companies will spearhead a task force that will comprise senior industry figures and will first meet in October. The task force will investigate the market’s needs, existing pricing mechanisms and physical delivery criteria.
“This is a ground-breaking initiative, and we are delighted to join together with the DME to explore the development of the first ever jet fuel futures contract," said Hussain Sultan, group chief executive of ENOC, in a statement. "ENOC has extensive expertise in this area and we are well placed to work with the DME and collaborate with the jet industry to create a successful, liquid risk management tool for the airline industry refineries and other energy players.”
The DME has already finalised the first Oman crude oil futures contract, in collaboration with the Sultanate of Oman’s Ministry of Oil and Gas, after extensive market research. Gary King, chief executive of the DME, said: “Now we are seeking to structure additional contracts that can support the energy trading community in better managing price and credit risk in a transparent and open market-place. This is a direct response to the market’s specific request for us to develop a jet fuel futures contract.”