CME Clearing Europe, CME Group’s European clearing house, today announced that it will begin clearing a new alternative fuel product, German Specification T2 Ethanol Swaps, and a new vegetable oil product, US dollar-denominated Rapeseed Oil Swaps. The company also announced that it will offer margin offsets between US dollar and Euro-denominated Rapeseed (Argus) Calendar swap contracts and the Argus Biodiesel RME FOB Rotterdam swap.
“The expansion of products is in line with our commitment to helping customers manage their risk. The energy market is adapting to the introduction of more alternative fuels, and we want to offer cleared products that enable those products to be risk managed alongside more traditional energy products,” said Andrew Lamb, chief executive officer of CME Clearing Europe. “We will offer risk-assessed margin offsets between products as the product range expands.”
In conjunction with clearing commodity contracts that support its clients’ risk management needs, CME Clearing Europe offers margin efficiencies through inter-commodity spread credits where product pairs are price correlated, and offers margin offsets between its OTC WTI and Brent crude oil contracts, as well as its gasoil contracts.
“Through the recent launch of CME Clearing Europe, CME Group is now providing a European platform for its global benchmark products. This represents an important value added for Citi and our customers, especially considering regulatory developments, as well as our clients’ increasing interest in European specific products. A point which was clearly proven when we cleared one side of the first OTC cleared Rapeseed Oil Swap trade at CME Clearing Europe,” says Andrew Sterry, European head of OTC Clearing at Citi in London.
