Japan to Start World’s First LNG Futures Within Two Years
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Japan, the biggest buyer of liquefied natural gas, plans to list the world’s first futures contract for the supercooled fuel on the Tokyo Commodity Exchange within two years.
The futures will be for cash settlement in dollars and based on an index price for spot LNG cargoes delivered to Japan, Takashi Ishizaki, the director for the commerce policy division at the Ministry of Economy, Trade and Industry, said by phone today. While the contracts won’t be for physical delivery, they will allow Exchange Futures for Physical, or so-called EFP, transactions that enable traders to swap their futures positions for a physical holding.