Singapore commodity bourse starts euro crude futures trade

31 August 2010 10:42  [Source: ICIS news]

SINGAPORE (ICIS news)--Trading of four futures contracts, including euro-denominated crude contracts, has started on Tuesday at the new Singapore Mercantile Exchange (SMX), the first multi-product commodity and currency derivatives bourse in Asia.

SMX, in a statement, said that it launched the trading of crude oil benchmarks - Brent crude and West Texas Intermediate (WTI) - denominated in euro, as well as the trading of euro-US dollar currency contract and the first gold futures contract in Asia.

"Further products will be rolled out in market segments such as energy, agriculture, metals (precious and base), indices and currencies," SMX said.

The launch of the new electronic trading platform was timely as it addresses the exigency for a regional commodity derivatives exchange, said SMX chairman Ang Swee Tian in a statement.

“Recent crises in the global financial markets have built a permanent preference for more regulated trading instruments such as the exchange-cleared contracts to be listed on SMX,” Ang said. “Liquidity flows to the east will also continue to rise,” he added.

SMX CEO Thomas McMahon, meanwhile, said that the trading platform would facilitate the creation of "a significant liquidity pool representing both international and niche regional trading interests during the Asian time zone”.

Singapore is a major financial centre in Asia, which also serves as a production hub for petrochemicals for energy giants such as ExxonMobil and Shell.

In July, the city-state's petrochemical output grew 12.5% year on year due to improved refining margins, with overall production in the chemicals cluster registering a 7.7% growth, according to the Singapore Economic Development Board (EDB).

Petrochemical production was up 36.2% year on year in the first seven months of the year, it said.

EDB said Singapore's overall manufacturing output expanded 9.9% in July, the smallest growth recorded in eight months.

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By: Nurluqman Suratman

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