(Yicai Global) March 26 -- Crude oil futures that began trading in Shanghai exactly a year ago today are increasingly aligning with international oil prices, according to the chief executive of J.P. Morgan Futures in China. 

China launched yuan-denominated oil futures last March in order to have more say when it comes to pricing the valuable energy resource. The contracts were the first that overseas investors could buy and sell without a presence in the country.

"We believe that the correlation between yuan-denominated crude oil futures prices and world oil prices has increased significantly over the past year," Rochelle Wei told Yicai Global. That "has helped bridge the gap preventing international crude oil prices from being priced in yuan and provides investors with effective hedging tools in the Asian time zone."

On its first day a year ago, contracts at the INE traded at CNY440 (USD70) a barrel, online state news outlet The Paper reported. US West Texas Intermediate futures traded at around USD65.50 per barrel, while Brent Crude was priced at about USD70. Today, WTI stood at USD59.58, Brent at USD67.39 and INE oil changed hands for CNY465.5 (USD68).

The Shanghai International Energy Exchange just issued its report card to mark the one-year anniversary of oil contracts trading. It reported turnover of CNY17.1 trillion (USD2.5 trillion), a cumulative volume of 367 million lots, with the largest single-day trading volume nearing 360,000 lots, the Wenhui Daily newspaper reported yesterday.

"Over the past year, the Chinese government has been steadily accelerating market reforms and opening up, which has attracted more international investors' participation in China's capital market," Wei said.

Barreling in

"Encouraged and supported by regulators and Shanghai INE, market participants and investors from many different countries and regions have started taking part in oil futures trading," she said.

The main challenge as shared by some clients, Wei noted, centers on the account opening process, which is more complex than the usual practice in many developed international markets. "Further simplification of this process could help the market's further development," she advised. 

China's efforts to open its capital market to the world will not only help enhance its position in the global futures market, but also provide more investment channels and hedging tools as international investors increase their investments in China, Wei said.

"To better support the sound development of China's capital market and provide more hedging financial tools for overseas investors, we hope that China's stock index futures market could be opened to international investors soon," Wei added. 

"We also hope that the China futures law will be launched soon, which will provide a more solid legal ground for futures trading," she concluded.