New Middle East crude contract could test OPEC’s grip on oil

New Middle East crude contract could test OPEC's grip on oil

Abu Dhabi authorized trading of a futures contract tied to its flagship grade of crude for the first time on Monday in a start that could test OPEC’s grip on oil prices.
Murban futures prices rose 0.6% to $ 63.90 per barrel on Intercontinental Exchange Inc.’s new ICE Futures Abu Dhabi market. 6.3 million barrels of crude changed hands at 5 p.m. local time or 9 a.m. ET.
Futures on Brent, the benchmark in international energy markets, edged up 0.6% to $ 64.98 a barrel after engineers freed the container ship that had blocked the canal. Suez, an artery for oil and gas. West Texas Intermediate, the leading grade of US crude, rose 1% to $ 61.56 per barrel.
Abu Dhabi plans to cede control of Murban’s prices to investors and traders, a major step in efforts to strengthen its position in the international oil market. The aim is to make Murban more attractive to refiners in Asia, where oil producers fight for their customers as Western governments seek to phase out fossil fuels.
By allowing crude to trade more freely, the emirate could ultimately undermine the influence of the Organization of the Petroleum Exporting Countries on prices. The changes Abu Dhabi is making will erode the cartel leader’s influence in Saudi Arabia over time, said Philip Verleger, energy economist and chairman of PKVerleger LLC.


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