ADNOC Begins Trading Crude Oil and Trading of Sector's Financial Instruments Through ADNOC Commercial
The Abu Dhabi National Oil Company (ADNOC) today announced that ADNOC Trading, the new commercial arm of the ADNOC Group, has started its activities in the field of crude oil trading and derivative financial instruments for the oil sector, through direct participation in the global financial instruments market.
This step represents a major achievement that comes within the framework of ADNOC's continuous efforts to achieve a quantum leap in its marketing and commercial activities and to enhance its role and position as a global integrated company in the energy sector with a focus on trading and trading crude oil and refined products.
Derivative financial instruments mean financial contracts according to their nature, risks and terms, including forward contracts, swap contracts, and buy and sell options based on pre-agreed prices that derive their value from real assets such as crude oil, which enables clients to obtain fixed prices and reduce risk in light of the fluctuations in the oil market. .
ADNOC established two commercial units: ADNOC Trading, which is 100% owned by ADNOC, which focuses on the trade of crude oil, and ADNOC Global Trade, which is a joint venture with Italy's Eni and Austrian OMV, which You will mainly focus on trading and trading of refined products.
Both ADNOC Trading and ADNOC Global Trading are headquartered in the Abu Dhabi Global Market on Al Maryah Island.
With the start of "ADNOC Commercial" its activity in the field of trade and commerce, "ADNOC Global Trade" is proceeding with the establishment of operations and the development of procedures and regulations required to start its activity in the coming months.
The ADNOC Global Trading team is currently working on enhancing the management of ADNOC's product flows of crude oil and raw materials, in addition to improving products. Upon completion of the preparation of the new trading systems, ADNOC Global Trade will increase its commercial activities.
ADNOC’s expansion of its commercial operations will enable the company to provide more services and products to its customers and increase value by finding new sources of revenue from sales of its growing portfolio of crude oil and refined products.
This important achievement represents one of the main enablers of achieving the "ADNOC Integrated 2030 Smart Growth Strategy" and a significant development that supports its continuous efforts to transform into a more flexible and business-oriented company focused on improving performance.
The Minister of Industry and Advanced Technology and CEO of ADNOC and its Group of Companies, Dr. Sultan Ahmed Al Jaber, said: “In line with the directives of the wise leadership to increase the value of hydrocarbon resources in the country, the announcement of the start of (ADNOC Commercial) activity in the field of trading and trading of derivatives represents a new step within ADNOC's constant endeavor to enhance value in all areas and aspects of its business, and a significant development that supports our continuous efforts to transform into an integrated energy company characterized by development, dynamism and flexibility.
He added: "We are committed to continuous work to increase the profitability and economic return to the country from every barrel of oil we produce, refine, market and ship, and to provide the best level of services to our customers. There is no doubt that ADNOC's orientation towards expanding its activities in the field of trading and trade will contribute to achieving these two goals."
Al-Jaber added: “The establishment of (ADNOC) for its two commercial units and the opening of their offices in the Abu Dhabi Global Market aims to enhance its presence at the global level and facilitate direct and rapid access to its customers around the world. It is also an evidence of the great successes achieved by the Abu Dhabi Global Market and an important step that contributes to the dedication. His position and his reputation as a leading commercial center for the circulation and trade of goods and products in the UAE and the Middle East region.
For his part, Minister of State and Chairman of the Board of Directors of Abu Dhabi Global Market, Ahmed Ali Al-Sayegh, said: “We congratulate ADNOC on the start of its activity in the field of derivatives trading and trading, as this event represents a major historic achievement as part of ADNOC's continuous efforts to take advantage of new opportunities that will increase value. It increases the economic return and enhances the level of contribution to the growth of the local economy, and we are pleased that ADNOC has chosen the Abu Dhabi Global Market as the new headquarters for (ADNOC Global Trade) and (ADNOC Commercial), both of which are affiliated with it, and we welcome their joining the Abu Dhabi Global Market family. "
In turn, CEO of ADNOC Marketing, Supply and Trading and Chairman of the Board of Directors of ADNOC Commercial, Khaled Salmeen, said: “Despite the exceptional circumstances imposed by the (Covid-19) virus, (ADNOC) has continued to maintain its flexibility and ability to adapt to challenges. And market fluctuations, and it succeeded in fulfilling its obligations towards its local and international customers, by implementing important steps, including the great achievement of switching to the new pricing mechanism for Abu Dhabi crude oil products, which uses forward contracts that depend on crude oil prices in the markets as price indicators.
He added, "In 2020, we succeeded in transforming our ambitious plans for both (ADNOC Commercial) and (ADNOC Global Trade) into a reality, and within the coming weeks and months, the trade and trading of crude oil and derivative financial instruments will become essential pillars of ADNOC's approach to managing Its business activities and operations, which helps us to better manage our product flows, enhance efficiency, and provide broad services and integrated solutions to our customers.
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