The Dubai Mercantile Exchange set two new trading records during the month of July, according to a press release issued on Aug. 8. The exchange not only achieved the highest average daily volumes, but also saw record physical delivery for its benchmark Oman Crude Oil Futures Contract (DME Oman) since trading began on the exchange in June 2007.
Average daily volumes (ADV) for DME Oman Crude Oil Futures Contract (DME Oman) in July stood at 4,427 contracts (equivalent to 4.4 million barrels of oil per day), with a record total of 88,539 contracts traded for the month. This represents a 35% year-on-year increase in trading levels on the exchange.
The month also saw DME Oman achieve a new record for physical delivery, with 15.4 million barrels of oil to be delivered in September 2011 through the Exchange, surpassing the previous high of 15.1 million barrels set for delivery in September 2010. This confirms the status of DME Oman as the largest physically delivered crude oil contract in the world, underscoring to market participants the benefit of robust price discovery through direct linkage to true market supply and demand fundamentals.
Thomas Leaver, DME’s CEO, commented, “These new records clearly demonstrate the steady progress that we continue to make in consolidating our Oman contract as the accepted price benchmark for crude oil in the Middle East and Asia.”
Leaver added, “With more than 50 companies trading regularly on the exchange, the market is clearly confident that price determined by these market participants in a regulated environment validates the DME Oman Contract as the most efficient price discovery and risk management tool for the fast-growing East of Suez crude oil markets. We will continue to focus our efforts on building liquidity and maintaining momentum.”
The DME, an electronic exchange, was launched in June 2007 with the goal of bringing fair and transparent price discovery and efficient risk management to the Middle East. DME Oman is the benchmark for Oman and Dubai crude oil. The DME is majority owned by core shareholders Tatweer (a subsidiary of Dubai Holding), Oman Investment Fund, and CME Group. In addition, global financial institutions and energy trading firms such as Goldman Sachs, J.P. Morgan, Morgan Stanley, Shell, Vitol, and Concord Energy have taken equity stakes in the DME.