New Delhi: China launched its first ever yuan-denominated oil futures contract in Shanghai on Monday, marking the first time foreign investors will have access to Chinese commodity futures as the world`s top crude importer seeks greater influence over global prices.
Shanghai crude oil futures opened up more than 6 percent with almost 20 million barrels of the most-active September contract changing hands in the first 25 minutes as China debuted its oil benchmark.
The launch of China’s yuan-denominated oil futures marked the culmination of a decade-long push by the Shanghai Futures Exchange (ShFE) aimed at giving the world’s largest energy consumer more power in pricing crude sold to Asia.
The current global standards are London-trade Brent futures, and West Texas Intermediate (WTI), which is traded in New York.
They mainly trade higher-quality light sweet crude oil, while the yuan contracts on the Shanghai International Energy Exchange involve mainly medium-sour crude.
It also is the latest in a series of steps by China to raise the world profile of the yuan.
The most-active September contract opened at 440.4 yuan per barrel from a reference point of 416 yuan, and jumped to as high as 447.1 yuan in the first few minutes.
At 9:24 a.m. (0224 GMT) prices were up 3.29 percent at 430 yuan, with 19,122 lots, equal to 19.1 million barrels of oil, traded.
With Agency Inputs