DUBAI: The Dubai Mercantile Exchange has dropped plans to offer fuel oil trading to focus on increasing volumes of its Oman crude oil futures to the point where big Gulf oil producers want to price off them, the DME’s chief executive said.
The exchange, which trades DME Oman Crude Oil Futures Contract (OQD), late last year was considering the introduction of fuel oil trading.
But after getting lukewarm feedback from customers, it has decided to stick to making Oman crude the price benchmark for Middle East crude sales to Asia.
“We are going to focus on OQD. It’s really important that we continue to grow the market and we have been very successful, we’ve had six months of month-on-month growth,” Chief Executive Officer Christopher Fix said.
“I want to ensure that we continue along the development of crude and not right now split the market’s attention between crude and other products. So we do not have any formal plans right now to move forward with another product,” he said in an interview.
Since joining the DME at the end of August 2012, Fix has focused on increasing the number of financial players — banks and hedge funds — that trade on the exchange. Only around 9 percent of DME volumes are traded by financial players.
RBS Securities Inc joined as a clearing member on April 8 and the exchange now has 64 users, up from around 50 a year ago.
Fix, who spent 20 years at BNP Paribas before joining the DME, said more financial players were in talks to join but declined to name any until they had officially signed up. Reuters
