NYMEX aims for Asian crude futures

NYMEX aims for Asian crude futures

SINGAPORE (Reuter): The New York Mercantile Exchange (NYMEX) plans to launch a crude oil futures contract for Asia by the middle of next year, NYMEX president Patrick Thompson said yesterday.

But NYMEX has not determined whether it will be a sweet or sour crude contract, or which physical crudes will be used as the basis of the contract, he said.

"There's certainly strong support in the region for Oman and Dubai. On the sweet side, Tapis and Gippsland have been identified as important factors in pricing. But a lot of other information has come our way and we're not at liberty to draw conclusions," Thompson said.

Thompson was in Singapore to take part in the Asia Pacific Petroleum Conference (APPEC) and was speaking to reporters at a news conference.

Thompson said that despite the lack of liquidity in existing oil futures contracts in Asia, NYMEX saw a positive attitude towards the development of a crude futures contract.

If need be, NYMEX might introduce additional mechanisms that will add to the liquidity of the market, he said.

Although NYMEX contracts are important benchmarks around the world, Thompson said that their use as hedging instruments have been limited to the west.

"But we think that this is a marketplace that will grow, and will develop conventions over time that are more similar to conventions that exist in Europe and the United States," he said.

He added that NYMEX was looking to work hand in hand with the producer of the crude that would be used as the basis of the contract.