The ICE Brent Crude American-style Option Contract is based on the
underlying ICE Brent Crude Futures Contract (B) and if exercised
will result in a corresponding futures position. The contract is
for American-style exercise, allowing the buyer to exercise an
option any time up to, and including the expiry day.
|Hedge Instrument||The delta hedge for the American-Style Option is the Brent Crude Future (B)|
|Contract Size||1,000 barrels|
|Units of Trading||Any multiple of 1,000 barrels|
|Currency||US Dollars and cents|
|Settlement Price||One cent ($0.01) per barrel|
|Trading Price||One cent ($0.01) per barrel|
|Minimum Price Flux||One cent ($0.01) per barrel|
|Last Trading Day||Trading shall cease at the end of the designated settlement period
of the ICE Brent Crude Futures Contract three Business Days before
the scheduled cessation of trading for the relevant contract month
of the ICE Brent Crude Futures Contract.
If the day on which trading in the relevant option is due to cease would be either: (i) the Business Day preceding Christmas Day, or (ii) the Business Day preceding New Year’s Day, then trading shall cease on the immediately preceding Business Day
|Option Premium / Daily Margin||Due to futures style margining option premiums are not paid/received at the time of the transaction. Rather margins are paid /received every day according to the changing value of the option. The total value to be paid/received is only known when the position is closed (by an opposing sale/purchase, exercise or expiry). The buyer never pays more margin than the cost of the premium. All open contracts are marked-to-market daily.|
|Exercise and Expiry||ICE Brent Options can be exercised into ICE Brent Futures contracts. ICE Futures Europe options contracts are of American-style exercise, allowing the buyer to exercise call and/or put options up to 17:00 (London time) hours on any Business Day (except on expiry day) during the life of the contracts, by giving an exercise notice to ICE Clear Europe in respect of such options.
On expiry day, the buyer has up to one hour after the end of the designated settlement period of the ICE Brent Futures contract 19:30 (London time) to exercise his options. At that time ICE Clear Europe will automatically exercise all options that are in-the-money on behalf of the Member unless instructed otherwise by the Member.
|Strike Price Increments||At launch multiples of $0.01 per barrel ranging from a strike of
$20 to a strike of $240. Additional strike prices are added
according to futures price movements.
The at-the-money strike price is the closest interval nearest to the previous business day's settlement price of the underlying contract.
|Position Reporting||All positions are converted to futures equivalents by way of deltas and are aggregated with the futures position for daily position monitoring by the Exchange. The Exchange's daily position management regime requires that all positions in any contract month must be reported to the Exchange on a daily basis. The Exchange has powers to prevent the development of excessive positions or unwarranted speculation or any other undesirable situation and may take any steps necessary to resolve such situations including the ability to mandate members to limit the size of such positions or to reduce positions where appropriate.|
|Expiry Limits||The Exchange may impose limits on positions in this contract at its
discretion in accordance with Exchange Rule P3.
Current expiry limit: 6,000 contracts in the last five business days, up to and including the expiry day in the spot month, inclusive of futures-equivalent position in Brent Options.
Exemptions from expiry limits may be granted at the Exchange’s discretion to participants who provide and document a commercial rationale for their requirement
|Contract Security||ICE Clear Europe acts as the central counterparty for trades conducted on ICE Futures Europe and ICE OTC. This enables it to guarantee the financial performance of every contract registered with it by its members (the clearing members of the Exchange) up to and including delivery, exercise and/or settlement. ICE Clear Europe is able to provide margin offsets between the options and the underlying futures contract as well against options positions executed in other option styles.|
|Contract Series||Consecutive months up to and including March 2020.|
|Business Days||ICE Business Days|
**Sunday Pre-Open 5:50 PM ET; Sunday Open 6:00 PM ET
NOTE: DST in the US will be different than BST time. See Circular 14011 for temporary trading hours changes.
Clearing Admin NameIPE e-Brent