China gets set to launch crude oil futures market
New company is unveiled to operate a trading platform in the new Shanghai free-trade zone, with foreign investors expected to be welcome
China is expected to launch crude oil futures in the Shanghai free-trade zone soon and invite foreign investors to trade.
The Shanghai Futures Exchange launched a 5 billion yuan (HK$6.3 billion) subsidiary, the Shanghai International Energy Exchange, in the free-trade zone yesterday, taking a major step towards the official launch of energy contracts.
According to two people involved with preparatory work for the oil contracts, trading could begin in the first six months of next year as the government seeks to add to the country's global economic clout.
Futures are an agreement to deliver or take delivery of a commodity or financial instrument at a certain date and price.
Tu Guangshao , a vice-mayor of Shanghai, described the launch of the energy exchange as an important move with far-reaching significance for the development of the free-trade zone, launched in September.
"The free-trade zone is aimed at facilitating investments and trade, and concrete and substantial steps must be taken to achieve the goal," he said.