China Will Pump Out Crude Oil Futures by Year’s End

Yicai

2017-05-13

(Yicai Global) May 13 -- Shanghai Futures Exchange (SHFE) has outed a body of crude oil futures trading rules and looks to tap its first batch of oil futures within the year.

SHFE subsidiary Shanghai International Energy Exchange Center issued the rules Tuesday.

They include the Articles of Incorporation of Shanghai International Energy Exchange Center and the Trading Rules of Shanghai International Energy Exchange Center, along with the Detailed Trading Rules of Shanghai International Energy Exchange Center, the Detailed Clearing Rules of Shanghai International Energy Exchange Center and nine other specific sets of standards. SHFE will help Shanghai International Energy Exchange prepare for crude oil futures to flow in the next few months, aiming to finish the groundwork by year’s end.

Over 65 percent of oil the country consumes already comes from elsewhere, but China’s thirst for crude oil imports continues to climb. Global oil prices are increasingly a financial phenomenon, and escalating volatility in geopolitics and petroleum prices poses a serious threat to China’s economy, warned Wu Libo, deputy head of the Energy Economics and Strategy Research Center at Fudan University. For China to build up its pricing power on the global crude oil market and create its own crude oil futures market and a world-class oil and gas trading center is thus becoming ever more imperative. Media earlier reported that Shanghai International Energy Exchange Center might release its first oil future contract as early as July.

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