Enron launches styrene swap contract in Europe

29 August 2001 17:13  [Source: ICIS news]

LONDON (CNI)--US-headquartered energy producer and petrochemicals trader Enron has launched the first styrene monomer (SM) financial swap contract for the European market.

It said Wednesday that the new (paper) contract is benchmarked against the ICIS-LOR index. The contract-for-differences instrument will be offered both online for standard agreements and via telephone or fax, known as 'over the counter'. The contract will be quoted with a US dollar bid/offer spread.

Enron, which last year launched a benzene swap contract, said the new financial instrument will provide a risk management tool for all styrene producers and consumers.

"This new contract will help both producers and consumers to manage their sales or cost exposure to the volatile styrene market," explained Rob Brewis, manager of Enron’s European plastics and petrochemicals trading desk.

"Styrene prices have varied by 300% over the past two years, so a financial risk management tool for this product is long overdue."

Brewis told CNI that the contract will have no minimum, although he expected most deals to be between 250 tonne to 2000 tonne a month with the majority in the 500 tonne to 1000 tonne range.

By: Neil Sinclair
+44 20 8652 3214

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly