China plans crude oil futures

China, the second-largest consumer of oil in the world, could soon launch a crude oil futures contract that could be accessible to international investors, according to Reuters.

The Chinese financial markets have generally been closed to foreign investment, with trading restricted on all but a few commodities. However, the chairwoman of the Shanghai Futures Exchange explained at the Shanghai Derivatives Market Forum that the country could soon be shifting its approach to global investment.

"The launch of crude oil futures is not merely about the Shanghai Futures Exchange having a new contract, but it symbolizes the gradual opening up of China's commodities futures to foreign investors," said Chairman Wang Lihua. "We hope to attract foreign investors, producers, traders, and consumers, and launch the contract within the year. We hope the contract will in time become one of the crude oil pricing benchmarks in the Asia-Pacific time zone."

The Financial Times reports Wang hopes to launch the oil futures contract sometime later this year, though the frequency of delays in the development of new contracts make this unlikely.

Information on the futures, options and derivatives market can be found at PennEnergy's Research area.


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