China's Yuan Oil Contracts: No Liquidity, but It Will be Built

Report post

It's definitely time to start seriously considering the impact of Chinese Yuan-denominated oil contracts. There's no real liquidity yet, but the Chinese are certainly working to build that up so suppliers can use them regularly against physical oil deliveries ... That's exactly what they're doing now. Between now and September, we should see a liquidity build-up because that's the date for the first delivery. 

Share this post


Link to post
Share on other sites

Report post

should we be skeptical? History shows that new contracts like this fail precisely because they can't get the liquidity going. Why is this one any different?

  • Like 1

Share this post


Link to post
Share on other sites

Report post

I'm not that skeptical. The Chinese have been preparing this for years and I think they'll meet the liquidity goal because they're now the world's largest crude importer. That means there is a true commercial need for hedging. 

  • Like 1

Share this post


Link to post
Share on other sites

Report post

Is there still a 5% band for the contract?

Share this post


Link to post
Share on other sites

Report post

that was only supposed to be until the first day of trading, which I believe was on the 25th, then it would supposed to be a 10% band ... 

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!


Register a new account

Sign in

Already have an account? Sign in here.


Sign In Now
Sign in to follow this  
Followers 0