Forward curve volume reached 208,997 contracts in the second quarter of 2019 versus 143,703 contracts traded in the first quarter. Exchange average daily volume increased from 5,024 in January 2019 to 6,695 in June 2019.
The forward curve represents the value of Oman blend crude oil in future months. A liquid forward curve allows customers to protect themselves against future price movement in Oman crude oil.
Total average daily volume in the pricing curve reached 6.1mn barrels in June this year compared to 3.5mn barrels in June last year.
This is an important development since further NOC (national oil companies) partners such as Saudi Aramco started utilising DME Oman as part of its crude oil pricing mechanism.
In addition, close to 150mn barrels of Oman crude oil were delivered via the exchange during the first six months of the year, maintaining DME’s position as host to largest physical delivery on any global futures contract.
Raid al Salami, managing director of DME, said, “DME Oman has always been a highly efficient and transparent price discovery mechanism for regional crude oil. We will continue to develop the market with our valued customers and our current and future NOC partners, where we endeavour to provide an unrivaled platform for traders that will ensure the sustainable growth of the sector.”
“The DME Oman crude oil futures contract has become a benchmark for sales of Middle East crude oil into Asia. The DME Oman contract was included in the calculation of the official selling price of Saudi Arabia and Bahrain from October 2018. The increase in liquidity along the forward curve allows for customers to better manage price movements during these times of high volatility,” he added.
DME said that customer participation has risen significantly in 2019, with a record number of 120 companies utilising the collateral efficiencies offered against other major crude oil benchmarks (WTI, Brent, Dubai, and Oman) within the CME clearing house where DME contracts are settled.