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CME and ICE Cut Crude Margins

OIL
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CME has cut margins for the nearest WTI crude contract from $6.6k per contract to $6k per contract effective after the close of business 17 March according to a note yesterday.

  • Earlier in the week ICE cut margins for Brent by almost 20% to $5,980 per contract effective from close of business March 15 for margin calls made March 16.
  • Crude aggregate open interest has ticked back up so far in March to just below a peak from mid Feb after a dip in the second half of February. Open interest increased at the start of this year assisted by falling market volatility and lower ICE margin rates.
  • Nymex WTI aggregate open interest is up from 1.75m contracts at the end of Feb to 1.796m and ICE Brent open interest is up from 2.06m to 2.18m.
  • A combination of higher oil prices, greater oil price volatility, higher trading costs, a lower economic outlook, and higher interest rates caused market participation to drop in 2021 and 2022.

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CME has cut margins for the nearest WTI crude contract from $6.6k per contract to $6k per contract effective after the close of business 17 March according to a note yesterday.

  • Earlier in the week ICE cut margins for Brent by almost 20% to $5,980 per contract effective from close of business March 15 for margin calls made March 16.
  • Crude aggregate open interest has ticked back up so far in March to just below a peak from mid Feb after a dip in the second half of February. Open interest increased at the start of this year assisted by falling market volatility and lower ICE margin rates.
  • Nymex WTI aggregate open interest is up from 1.75m contracts at the end of Feb to 1.796m and ICE Brent open interest is up from 2.06m to 2.18m.
  • A combination of higher oil prices, greater oil price volatility, higher trading costs, a lower economic outlook, and higher interest rates caused market participation to drop in 2021 and 2022.

Keep reading...Show less