UPDATE 2-ICE Dubai crude futures open new exchange arena
5/21/2007 10:27:10 AM
new Dubai sour crude oil futures contract saw modest trade on Monday in the opening salvo of its battle with the New York Mercantile Exchange (NYMEX) for the dominant Middle East contract.
Atlanta-based IntercontinentalExchange, which hosts Europe's benchmark Brent crude contract, stole an 11-day march on its top rival by announcing its own Middle East contract just as the Dubai Mercantile Exchange (DME), a joint-venture between Dubai, Oman and the NYMEX (NMX.N: Quote, Profile , Research), delayed its offering to June 1.
The world's top two energy exchanges are racing to build trading volume behind the two different contracts, with ICE counting on an entrenched price system and well-established platform while the DME hopes to quench a thirst for change.
Both are hoping to capitalise on rising supplies of high-sulphur crude, growing Asian oil consumption and demand for better risk-management tools in Asia, where past efforts to establish a vibrant futures market have failed.[ID:nL19431827]
Analysts say only one of them is likely to develop enough liquidity to allow easy entry and exit for investors.
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Dubai is a city in the United Arab Emirates that is built around the principles of free trade, foreign investment, and sound business practices. It was Sheikh Maktoum bin Hasher Al Maktoum who declared Dubai as a free port in 1901, abolishing all tariffs. The Dubai property market is setting the standards for property development throughout the world
