OREANDA-NEWS. October 24, 2012.  TNK-BP and St. Petersburg International Mercantile Exchange (SPIMEX) have announced the creation of a new primary market financial instrument – fuel futures with delivery via TNK-Magystral Cards, reported the press-centre of TNK-BP.  

The instrument has been specially developed for the Russian market in order to provide traders with the opportunity to get hedged against price risks amid fuel price volatility. As of now any organization or a private sector individual may buy futures at SPIMEX for a required fuel volume at a market price, after which the fuel will be credited to the TNK-Magystral fuel card valid within the company service station network.

SPIMEX will start fuel futures trading before the end of 2012.

The futures will make it possible to buy three most popular types of fuel: АI-92, АI-95 and diesel fuel. The minimum scope of one contract – 10 liters. The futures have an advantage of being able to freeze the fuel price for the future by paying ahead only for a small part of the commodity (about 7–10%). Moreover, the futures owner can sell it at the exchange any time.

“Magystral Cards (a TNK-BP Group company) jointly with SPIMEX are providing traders with a unique and qualitatively new product. The instrument is targeted towards corporate customers and makes it possible to provide a hedge against fuel price risks. The program is to involve 459 company service stations in five major Russian regions. In the future the geographic scope of the program may be extended”, said Irina Taruta, Head of Business Strategy and Development Division, LLC Magystral-Card.

“Fuel Futures with delivery via TNK-Magystral cards – is indeed an innovative product for the Russian market. Its unique feature – a combination of practical benefit for a wide range of customers – fuel users and appeal of the new, interesting, liquid exchange instrument for financial sector participants. Owing to the fusion of advanced technologies and experience of SPIMEX and TNK-BP we managed to provide a simple and effective mechanism to protect against price risks on the fuel market, and we hope that this product will be properly appreciated by our customers”, – said SPIMEX Vice President Mikhail Temnichenko.