Natural Gas futures: NSE receives SEBI nod to launch exchange-traded derivatives based on IGX price index

NSE said that it will launch the ‘Indian Natural Gas Futures’, which are derivative contracts based on IGX’s benchmark Price Index GIXI. The IGX platform is India’s authorised gas exchange, which provides a platform for natural gas trading via futures and options.

The upcoming futures contracts on NSE will be designed to reflect domestic gas market dynamics, with pricing for the same linked to actual trades on the IGX platform. However, the launch dates, along with details for the contracts, are yet to be finalised.

The exchange’s move behind launching this new product is to provide a transparent and reliable risk management mechanism for stakeholders across the gas value chain, and provide the participants with an investment tool.

“By introducing derivatives based on IGX benchmarks, we aim to create robust risk management tools that are closely aligned with the domestic physical gas market. We believe that Indian Natural Gas futures will enhance market efficiency, deepen liquidity, and support the growth of a transparent and competitive gas market in India,” said Sriram Krishnan, Chief Business Development Officer (CBDO) of NSE. ‘

Brent crude oil futures on NSE

NSE’s move to launch the natural gas futures comes after the exchange launched a dated Brent crude oil (Platts) futures contract on March 27, for the derivative market investors last week, amid heightened demand for energy assets in the market.

From April 13, NSE will be offering the global oil benchmark commodity derivatives for trading in the Indian stock market, collecting data from the underlying Platts Dated Brent Assessment by S&P Global.

The official data suggests that the future contracts will be traded using 100 barrels as the unit metric for measurement of the value per barrel of crude oil, with a maximum order size of 10,000 barrels, holding a minimum ticket size of ₹1.

NSE’s crude oil futures will be open for trading from Monday to Friday, every week between 9 am and 11:30/11:55 pm (based on the US daylight saving time).