China’s long-heralded crude oil futures contract to start trading March 26
Shanghai Futures Exchange says the contract is not a challenge to established global crude benchmarks
China’s long-heralded crude oil futures contract will begin trading on March 26 as the world’s second-largest economy starts to gain pricing power over the commodity.
The China Securities Regulatory Commission announced after the market closed on Friday that the official launch would take place at the Shanghai International Energy Exchange, the mainland’s first commodity futures venue that allows foreign players to participate in trading.
The launch date is in line with market speculation and comes after a six-year wait for the yuan-denominated contract.
“Crude oil futures is the most important commodity contract on China’s futures market,” said Huang Lei, a commodity futures analyst. “It was not easy to design and create a complete system in a new market.”
The new contract could technically challenge the dominance of the current global benchmarks, including the Intercontinental Exchange’s London-based Brent crude oil contract and the New York Mercantile Exchange’s West Texas Intermediate.
But the Shanghai Futures Exchange, parent of the International Energy Exchange, played down talk of any rivalry.