(Yicai Global) March 26 -- The first trading day of the yuan-dominated crude oil futures contracts in China attracted many domestic and foreign investors, achieving a high volume.
The benchmark trading price of crude oil futures dominant contract SC1809 gained 3.92 percent in early trading, showed data provided by Shanghai Futures Exchange, SHFE. A total of 30,700 lots were traded for CNY13.38 billion (USD2.1 billion) with an average daily price of CNY432.3 per barrel. The total trading volume for all crude oil contracts amounted to 32,000 lots, with trading turnover of CNY13.9 billion in early trade.
Local companies rushed to open accounts in the crude oil futures market, with high involvement of all clients, Zhao Guiping, chairman of GF Futures, told Yicai Global.
"The enthusiasm of foreign institutions was immense," said Neil Ge, CEO of DBS Bank China, adding, "Most major energy companies in the world have already opened deposit margin accounts with us, and the account opening of some institutions is still going on. Customers who have already opened accounts took part in trading today."
A total of 413 clients bid, with 261 contracts traded at CNY440 a barrel, SHFE data showed.
Oil enterprises that took part in the collective bidding and reached a deal in the first batch include domestic enterprises such as China National United Oil Corporation, UNIPEC Asia Company Limited, CNOOC Petrochemicals Import & Export Co. and Sinochem Oil Co. Many overseas enterprises including Glencore Plc also partook in today's trading.
To assist domestic and foreign customers in crude oil futures trading, JPMorgan will now provide trading and clearing services for the yuan-denominated crude oil futures contracts to customers in and outside China, it said today.
"China is the world's largest crude oil importer, and the launch of the yuan-denominated crude oil futures contract is an important milestone in the development of China's futures market," said David Martin, JPMorgan's head of futures, options and OTC clearing for Asia-Pacific region.
"China will soon introduce other varieties of internationalized futures, such as internationalized iron ore futures, after the trading, settlement, delivery, investor education and market operation of crude oil futures," Zhao said, adding, "The debut of crude oil futures today has epoch-making significance for the internationalization of futures varieties."