IGX launches fuel index, plans buying and selling in pipeline capability

The Indian Gasoline Alternate (IGX), promoted by the Indian Vitality Alternate (IEX), has launched an index that may replicate fuel costs and can quickly give you a product for buying and selling in fuel pipeline capability.

The index, which IGX has named ‘GIXI’, will replicate the volume-weighted common worth for all fuel traded and would signify the fuel costs on the Western and Southern hubs. It will assist market individuals know the inland fuel costs and take appropriate selections, IGX’s MD and CEO, Rajesh Kumar Mediratta, instructed businessline.

Members can supply to promote and purchase fuel (together with LNG), for which IGX expenses ₹4/mmBtu every from the vendor and the customer. The fuel should essentially be bodily delivered and brought. The NSE is engaged on bringing out a product for cash-settled fuel commerce, for which GIXI will function the bottom — NSE can pay a price for using the index, Mediratta stated.

Within the final two years, IGX has seen about 1,980 trades. Mediratta stated the costs found by means of the trade have been typically decrease than the worldwide costs.

Gasoline pipeline capability

Requested about IGX’s plans for the approaching years, Mediratta stated the trade had utilized to the Petroleum and Pure Gasoline Regulatory Board (PNGRB) for an approval to launch buying and selling in fuel pipeline capability. Whereas solely three firms — GAIL, GSPL and PIL — personal fuel pipelines, many firms typically contract for pipeline capability. Typically this capability just isn’t absolutely used. In such circumstances, such surplus pipeline capability might be traded on IGX.

As well as, IGX additionally intends to come back out with a product for small capacities of fuel. This implies a small firm may even purchase a few truckloads of liquid fuel. IGX has 9 supply factors throughout the nation, from the place small portions of fuel might be lifted.

Moreover, the trade will give you a one-year contract, too. At current, one should buy or promote fuel for the subsequent day, week, month or six months; however sooner or later, an extended interval contract can be potential. 

Information offered by IGX present that within the present 12 months, as much as January 2023, the trade has traded 27.79 million mmBtu; the costs have ranged from a low of ₹1,222 to ₹2,682/mmBtu. The best quantity was in December — 7.55 million mmBtu, for ₹1,241/mmBtu.

‘Not in a rush’

The promoter, IEX, is required to convey down its stake from 47 per cent now to 25 per cent, which is prone to occur by means of an IPO. Requested about this, Mediratta stated there’s time until 2025 and “we’re not in a rush.”

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