In a significant development for global commodity markets, Bloomberg has unveiled the new Bloomberg Commodity Murban Crude Oil Index. This specialized index is designed to track the performance of rolling futures on Murban Crude Oil, a rapidly emerging player in the global oil market. As a subindex of the Bloomberg Commodity Index (BCOM), the new Murban Crude Oil Index reflects the growing prominence and recognition of Murban crude, positioning it alongside established global benchmarks like Brent and West Texas Intermediate (WTI).
The Murban crude oil future, which began trading in March 2021, is a physically delivered contract based at Fujairah and trades on the ICE Future Abu Dhabi (IFAD) exchange. This new futures contract has significantly boosted the number of physical and financial buyers for the UAE’s Murban crude oil, drawing over 150 participants since its inception. These participants hail from various global regions, including the United States, Europe, Asia, and the Middle East, underscoring Murban crude’s worldwide appeal and marketability.
Since the launch of IFAD, over 5.5 million contracts have been traded, equivalent to 5.5 billion barrels of Murban crude oil. Moreover, approximately 244 million barrels of Murban crude oil have been successfully delivered through IFAD, demonstrating the robustness and reliability of its delivery process. This level of activity highlights the growing confidence of customers in the IFAD framework and the rising stature of Murban crude in the global oil landscape.
Extracted from Adnoc’s onshore concessions, Murban crude accounts for more than half of the UAE’s total oil production, marking its significance in the region’s oil sector. The introduction of the Bloomberg Commodity Murban Crude Oil Index is poised to offer investors new avenues for exposure to the crude oil market. Historically, global crude oil markets have been dominated by WTI and Brent Crude Oil futures. However, the Murban Crude Oil Index offers distinct diversification benefits due to the unique geographic demand, crude grade, and transportation dynamics associated with Murban crude.
Bloomberg’s index research team notes that this diversification not only provides investors with an alternative to WTI and Brent Crude Oil exposure but also allows them to more precisely navigate geopolitical risks and regional growth trends. This development is expected to enhance investors’ strategies in the crude oil market and could potentially reshape global oil trading dynamics, highlighting Murban crude’s growing influence in the energy sector.
