What do regional contracts for Asia, Europe and North America offer to the industry?

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What do regional contracts for Asia, Europe and North America offer to the industry?

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Regional contracts reflect the different ways regional markets operate, and therefore price differentials that occur between regions. In addition, regional prices reflect existing industry practise and are more familiar to the industry than global prices. However, global prices allow those participants with exposure in different regions to hedge this on a forward basis until a regional commitment becomes evident. They also help to improve price correlations with the physical market and offer additional arbitrage opportunities.