Pipeline Giants’ Houston Oil Futures Seen Launching in Months
Bloomberg 1/23/2021 Sheela Tobben
(Bloomberg) A new futures contract for the physical delivery of crude in the Houston area may only be a few months away from launching.
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Enterprise Products Partners LP and Magellan Midstream Partners, the pipeline companies responsible for delivery of Houston’s two active futures contracts, said Thursday they are joining forces to create a broader benchmark. That may happen in a few months, said Bruce Heine, a Magellan spokesman.
The Houston contracts reflect a shift in the oil industry’s focus from the storage hub in Cushing, Oklahoma, the delivery point for New York-traded futures, to the Gulf Coast. A global appetite for U.S. crudes resulted in a new web of pipelines and terminals to connect the Permian Basin of West Texas and New Mexico to the world.