DME to launch option contracts

The Dubai Mercantile Exchange (DME) is set to launch of a suite of DME Oman-linked swap and option contracts in December. The contracts will be listed by CME Group which is a core shareholder of DME and the world's largest derivatives exchange.

The six futures contracts that will be available for clearing on CME ClearPort are: DME Oman Crude Oil Swap Futures; DME Oman Crude Oil vs. ICE Brent Swap Futures; DME Oman Crude Oil Average Price Option; Singapore Mogas 92 Unleaded (Platts) vs. DME Oman Crude Oil Swap Futures; Singapore Gasoil (Platts) vs. DME Oman Crude Oil Swap Futures; and DME Oman Crude Oil Balmo Swap Futures.

The contracts, which will be listed for trading on Sunday, December 5, 2010 for trade date Monday, December 6, 2010, are subject to the rules and regulations of NYMEX and Chicago Mercantile Exchange.

The introduction of a full suite of DME Oman-related risk management tools will help  industry participants to manage price risk more effectively in the Middle East and Asia Pacific energy markets, said a press statement.
The DME will be holding seminars in Tokyo and Singapore on December 7 and 9 respectively to update industry participants on the new contracts and other related developments at the exchange.

 “These new contracts will offer our customers greater choice in addressing their risk management needs by providing additional flexibility in hedging and trading.  It will also further consolidate the DME Oman contract as the third global crude oil pricing benchmark, alongside WTI and Brent,” Ahmad Sharaf, Chairman of DME said.

 “The listing by CME Group will bring these contracts to the market in an expeditious fashion, supported by a robust regulatory framework, state of the art trading facilities, and effective counterparty clearing,” said Thomas Leaver, Chief Executive of DME, said.

The DME recently reported a positive uplift of 52 per cent in trading volumes over the past three months as compared to same period in 2009.