NYMEX introduced ASCI contracts earlier this month and said it will launch a physically-deliverable U.S. Gulf sour crude contract early in December. Around the same time, the ICE will launch cash-settled futures contracts tracking ASCI on December 7.
For some analysts, providing the option of a physical settlement could give NYMEX the edge.
But the ICE has also claimed victory. In an interview with Reuters, its Chairman and Chief Executive Jeffrey Sprecher noted Saudi Arabia had stuck to using a Brent Weighted Average (BWAVE), based on Brent crude futures, for shipments of Saudi crude into Europe and argued the U.S. benchmark was flawed.
The most liquid contract in the world, U.S. light crude futures, is based on West Texas Intermediate (WTI), a land-locked oil delivered into Cushing, Oklahoma.
Critics of the contract argue it tends to reflect inventories at the delivery point, rather than supply and demand in the major oil consumption center, the U.S. Gulf Coast.
Bob Levin of CME Group has not ruled out that ASCI could over time wrest liquidity from the main U.S. contract, but only by relying on its support.
For now, sour crude contracts will need to lean on WTI for liquidity support. Not only is ACSI structured as a direct differential to the NYMEX WTI settlement price, the three ASCI component crude streams are each priced as a direct differential to the NYMEX WTI settlement price, he told Reuters.
Analysts also say NYMEX heating oil and RBOB gasoline futures reflect domestic fundamentals in the United States.
ICE and many traders laud the greater geographic flexibility, not just of Brent crude, but of ICE's flagship refined products contract gas oil, whose volumes have hit a record.
But ultimately, it can just be a matter of regional preference, which contract on which exchange traders prefer.
There's not much difference (between ICE and NYMEX), said Tokyo-based analyst Toshinori Ito of UBS. It may really depend on individual traders which exchange they would support.
What nearly all agree is both will remain dominant as the smaller exchanges springing up face a huge challenge to compete.
I'm not dismissive of the others, but for players who want serious liquidity, it has to be NYMEX or ICE, said Mike Wittner of Societe Generale.
(Editing by Sue Thomas)