OPIS to Launch Online Trading Venue for Renewable Identification Number (RIN) Credits
Full-day electronic trading for Renewable Identification Numbers (RINs) using the benchmarked OPIS assessment on the OTC Direct platform.
In an effort to bring greater transparency, price discovery and liquidity to the market for Renewable Identification Number (RIN) credits under the U.S. Renewable Fuel Standard (RFS) program, OPIS by IHS Markit is pleased to announce the launch of OPIS Trade Link, an online trading venue hosted on the OTC Direct Platform.
OPIS Trade Link’s web-based, centralized electronic trading instruments will increase visibility into the often-opaque RIN credit market, assuring participants that they are buying or selling the compliance credits at the best possible price. The new venue also will address EPA’s desire for greater insight into how the credits trade on a daily basis.
“OPIS has long prided itself on responding to and anticipating the needs of those who do business in the markets that we cover and OPIS Trade Link is another example of that,” said Fred Rozell, president, OPIS. “We believe this new trading venue marks a big step forward in increasing transparency in the RINs market, lowering our customers’ cost of doing business and improving our benchmark assessments for the credits.”
An IOSCO-compliant Price Reporting Agency, OPIS is the benchmark for RINs pricing. OPIS Trade Link bids, offers and trades will take priority in informing our full-day price assessments for D6 conventional ethanol, D4, biomass-based diesel, D5 advanced biofuel and D3 cellulosic biofuel RIN credits.
The OTC Direct platform was developed by Julian Anstes, who previously founded trading technology provider Elysian Systems which was acquired by the CME Group in 2010.
OPIS Trade Link will offer traders the flexibility to enter and move RIN positions directly for peer-to-peer trading or to go through a broker.
OTC Direct features a robust credit matrix that allows company administrators to control counterparty risk for each RIN category and to establish buy and sell capabilities as well as dictate facility preferences.
In addition to spot trades, OTC Direct will allow market participants to trade credits for the full year and beyond, as well as financial derivatives. The system will generate electronic time stamps for every order entered, canceled and filled.
Trade confirmations and invoices will be sent to respective parties in real time and can be separated into physical and financial transactions.
There’s no cost to trade RINs for market participants that input bids and offers. A transaction fee will be assessed for participants that hit a posted bid or lift an offer.
OPIS Trade Link will allow RFS obligated parties, renewable fuel producers, fuel distributors and retailers to reduce their costs of trading RINs, provide more visibility into the market and improve OPIS’ daily price assessments for the credits.
OPIS Trade Link was developed in partnership with OTC Direct Markets and Blackstar Markets.
For more information please contact:
Jeff Barber
Associate Director, Renewables
OPIS by IHS Markit
jeffrey.barber@ihsmarkit.com
Justin Dirico
Principal and Head of Broking
Blackstar Markets LLC
+1 (917) 993-0146
justin.dirico@blackstarmarkets.com
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About OPIS by IHS Markit
Oil Price Information Service (OPIS) provides price transparency across the global supply chain so that all stakeholders can buy and sell oil commodities with confidence. We do this by providing transparent pricing, real-time news, powerful analytics and software and educational and networking events.
About OTC Direct Markets
OTC Direct is a digital online marketplace for over-the-counter (OTC) commodities. The technology has been in production for five years in agricultural markets and two years in biofuels markets in partnership with Blackstar Markets.
About Blackstar Markets
Blackstar are an established brokerage in the biofuels space. They are bringing their expertise to broker certain markets on OTC Direct. As an NFA registered broker they provide block futures liquidity on OTC Direct.