Gazprom Neft has become Russia’s first vertically integrated oil company (VIOC) to operate directly as a market maker on the St Petersburg International Commodity Exchange (SPMMEX) futures market. As part of a programme to support market offerings of physically-settled SPIMEX Urals Crude Futures (FOB, Primorsk) the company will submit and support sales calls for Russian-branded oil blends on a regular trading basis.
A pool of oil companies — market makers — is currently being formed on SPIMEX, which will ensure stable supplies of Urals blend under futures contracts (i.e., as applied to deliveries of tanker cargo at Primorsk) and will incentivise exchange trading by the main international players — buyers of Russian Urals crude.
Trading in Urals Crude Futures on SPIMEX commenced in November 2016. Futures transactions covering a total 3.5 million barrels of oil have been concluded since November last year.
Anatoly Cherner, First Deputy CEO for Logistics, Processing and Sales, Gazprom Neft, commented: “The formation of an exchange trading market in oil exports in Russia is an important process, through which pricing mechanisms are now being developed, as well as connections between the commodity and financial spheres. Gazprom Neft is an active participant in this project, testing exchange instruments in partnership with SPIMEX and other specialist agencies. The industry expertise offered by our company will lay the foundation for creating effective exchange trading mechanisms, reflecting the interests of all trading participants.”
The Saint Petersburg International Mercantile Exchange (SPIMEX) is the largest Russian commodity exchange in Russia, offering a wide range of products traded both in its Spot Commodities Markets (oil (refined) products, crude oil, natural gas, LPG, timber and construction materials) and in its Derivatives Market. The Exchange’s key task is operating a transparent pricing mechanism to ensure fair prices for commodities produced in Russia. SPIMEX was incorporated in 2008. The exchange license is available at the SPIMEX web-site.