New Highs Reached for Volume, Open Interest and Physical Delivery as Steady Growth Continues
The Dubai Mercantile Exchange Limited (DME) announced today that it set several new records in October to mark the strongest month of trading of its benchmark Oman Crude Oil Futures Contract since the launch of the Middle East's first energy futures and commodities exchange on 1 June 2007.
The DME's Oman Crude Oil Futures Contract traded a total of 39,885 contracts during the month of October, beating the previous monthly volume record of 39,571 set during the Exchange's first month of trading in June. The DME has also seen active trading of the Oman Crude Oil Futures Contract in recent weeks as far out as December 2008, providing further evidence of steady growth as the DME continues to develop its global customer base and attract new participants and members.
In another new record, open interest on the DME at the close of October trading stood at 8,558, surpassing by 2,091 contracts the previous monthly high of 6,467 recorded in June 2007. Open interest is the number of futures contracts entered into but not yet liquidated by an offsetting transaction or by delivery and is regarded as a leading indicator of success by the industry.
The DME also reported a record number of 4,283 contracts going to physical delivery during the month of October. This is equivalent to 4.283 million barrels of oil and beats the Exchange's previous record of 4,000 set when contracts traded in June were successfully delivered in August 2007. The physical delivery of contracts traded on the DME is conducted through the Mina Al Fahal storage and loading facilities located in the Sultanate of Oman.
Welcoming the announcement, Ahmad Sharaf, Chairman of the Dubai Mercantile Exchange, said: "October has been a record-breaking month for the DME and is powerful evidence of the solid progress that we have been making since our launch. We are especially pleased with the overall volume of contracts traded, the record number going for physical delivery and the high levels of open interest."
"Our customers and partners share a common determination to continue on this successful path as the Oman Crude Oil Futures Contract becomes firmly established as the global benchmark for Middle East sour crude oil."
Gary King, Chief Executive Officer of the DME, added: "We are now seeing the establishment of a consistent growth trend in trading activity as additional members join the DME and new participants become engaged.
"This is especially true in Asia, where the market has understandably taken time to see how our Oman contract works in practice. We have now successfully completed three full trading cycles through to physical delivery and the industry is becoming more comfortable using the DME for pricing of physical barrels of sour crude oil."
"This has had a very positive effect on market confidence and participation as the industry can now see clearly the benefits of greater transparency in the trading of Middle East sour crude oil and the ability to better manage their risk. We will continue to work with our customers to build on these solid foundations and maintain our steady progress."