NEW YORK (REUTERS) - Commodities brokerage OTC Global Holdings (OTCGH) said on Monday (Jan 31) it had opened a new office in Singapore as it seeks to expand its market share in the Asian market, a growing part of the global commodity trade.
OTCGH, the world's largest independent institutional broker of commodities, covers financial and physical instruments from its offices in Chicago, Geneva, Houston, New Jersey, London, Louisville and New York.
OTC Asia will replicate its North American and European offerings by broking European and Asian crude swaps, distillate swaps and cracks, and physical fuel broking, the company said in a statement.
Eventually, the Asia arm of the brokerage plans to expand into the US domestic grade crude swaps business by offering those services in Singapore.
OTCGH provides liquidity on exchanges including ICE, NFX, CBOT and NYMEX. The brokerage holds a 35 per cent US market share in natural gas options and 65 per cent in natural gas liquids (NGLs).
"Because of our light-ends liquidity pool in the US and Europe, that would be something we will build on in the front," Joseph Kelly, president and chief operating officer, told Reuters.
The Asia office will be led by Neil Grierson, a crude swaps broker who has spent over six years in OTC commodities broking, the company said.
"With the recent consolidation in the brokerage space, it is reassuring to work at a firm that has not bowed to purchase offers and instead chooses to continue pushing ahead with its own expansion and development," Grierson said. "Although the Singapore oil swaps market is extremely competitive, I expect we will rapidly strengthen our position thanks to our unique competitive advantage."
Over the last few years, a crude oil price rout and an increasing preference among traders for electronic trading have led to a number of mergers and acquisitions in the brokerage space.
In 2014, Tullett Prebon bought oil broker PVM Oil Associates Ltd for US$160 million to expand its suite of energy products and deepen its global crude, refined and middle distillates coverage.
Tullett Prebon also purchased the voice-broker business of its former rival ICAP Plc last year and changed its name to TP ICAP PLC.
OTC offers its own electronic trading platform as well, known as EOXLive.