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New York Harbor Ultra-Low Sulfur Diesel (ULSD) 
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New York Harbor Ultra Low Sulfur Diesel (ULSD) (Physical) futures are an outright diesel fuel contract between a buyer and a seller that enables customers to manage and trade the volatile price spread between heating oil and diesel. The contract:

  • Serves as a proxy for hedging heating oil
  • Enables refiners, wholesalers, and retailers to hedge financial risk
  • Provides price transparency for ULSD

Things to know:

  • Traded via open outcry and electronically on the CME Globex platform
  • Final settlement price is based on the average-weighted price of trades done in the closing range on termination day

About New York Harbor Ultra Low Sulfur Diesel (ULSD)

The New York Harbor ULSD futures contract, coded LH, features physical delivery of 15 PPM Sulfur ULSD using the Colonial Pipeline specifications for 61 Grade ULSD. Delivery takes place following termination of trading. The delivery terms in New York Harbor are identical to the delivery requirements for the New York Harbor Heating Oil Contract. The final settlement price is based on the average-weighted price of trades done in the closing range on termination day.

Government regulations currently require diesel fuel refiners to produce a minimum of 80% of diesel fuel as ULSD. In 2010, refiners will be required to produce the entire diesel pool as ultra low-sulfur grade. New York serves as one of two key trading centers in the cash market, the other being the Gulf Coast