Enterprise, ONEOK Extend Fee Waiver for Midland WTI Transfers Through 2028
(P&GJ) — Enterprise Products Partners and ONEOK Inc. have extended their fee waiver for crude oil transfers between the Enterprise Crude Houston (ECHO) and ONEOK East Houston (MEH) terminals through Dec. 31, 2028. The waiver applies to crude delivered through Intercontinental Exchange's (ICE) Midland WTI futures contract (HOU).
“In 2024, crude producers, refiners, and exporters moved more of their pricing and hedging away from a WTI Cushing basis to ICE Midland WTI (HOU), while price reporting agencies have launched new assessments which price all North American crude grades as differentials to HOU,” said Jeff Barbuto, Global Head of Oil Markets at ICE. "Physical deliveries of ICE Midland WTI were twice that of the Cushing WTI contract in 2024. Extending the fee waiver through 2028 provides the industry with added incentive to migrate crude pricing to the U.S. Gulf Coast via ICE HOU."
Under the waiver, buyers who take an HOU futures position to delivery can request a preferred terminal, though sellers retain final selection between MEH or ECHO. If the buyer’s preferred terminal is not chosen, they can transfer crude between the two at no cost. The waiver also covers transfers for customers using ICE’s Exchange for Physical (EFP) and Alternative Delivery Procedure (ADP) mechanisms, provided they show proof of transaction to ONEOK or Enterprise. A 10-cent per barrel charge applies to all other HOU-quality WTI transfers between the ECHO and MEH terminals.
In 2024, over 82 million barrels were delivered through ICE’s HOU exchange mechanism. The contract saw 5.5 million futures traded last year, averaging 21,000 contracts per day.
ICE has seen growing industry adoption of HOU as the benchmark for Midland crude pricing. Continental Resources recently switched a portion of its Permian production to HOU-based pricing, moving away from WTI Cushing. Additionally, Platts, part of S&P Global Commodity Insights, began daily price assessments for Midland WTI crude as a differential to HOU on Jan. 22, 2025. General Index also launched a suite of North American crude grade assessments using HOU as the benchmark.
ICE offers HOU time spreads and inter-commodity spreads with Brent and WTI Cushing (Domestic Sweet) to help traders manage price risk across locations and grades. Customers can also access margin offsets of up to 98% when clearing HOU alongside other oil contracts at ICE, covering over 800 oil derivatives, including ICE Brent, ICE Gasoil, ICE WTI (Cushing), ICE Dubai (Platts), and ICE Murban.
ICE continues to see record energy trading volumes, with 1 billion energy derivatives contracts traded in 2024, including 655 million oil futures and options contracts.
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