China’s Yuan Crude Oil Futures Jump to Record High
The yuan-denominated crude oil futures trading in China hit this week their highest level since the contract was launched in 2018 as escalating threats to Middle East’s oil supply and increased purchases by Chinese refiners push prices higher. Launched in March 2018, the INE crude oil futures contract (SC) is a physical-settlement contract priced and traded in Chinese yuan on the Shanghai…
China's yuan-denominated crude oil futures reached a record high this week, climbing to 929.4 yuan or $138.50 per barrel on the Shanghai International Energy Exchange. This surge came as a result of escalating threats to the Middle East's oil supply and increased purchases by Chinese refiners. The contract, launched in March 2018, is priced and traded in Chinese yuan and settles physically.
The price spike was triggered by the East-West oil pipeline in Saudi Arabia being attacked by drones, forcing the kingdom to temporarily shut it down. This has heightened concerns about the supply from the Middle East. International crude oil benchmarks also rose, with Brent Crude hitting $108 per barrel and the U.S. benchmark, WTI Crude, reaching above $103 a barrel.
The situation remains uncertain as there is no timeline for when the pipeline will reopen and continue to help Saudi Arabia bypass the Strait of Hormuz with shipments from the Red Sea port of Yanbu. Chinese yuan crude futures are closely tracking benchmarks for crude grades of similar quality, such as Oman and Murban, which were also trading above $120 per barrel this week. The rising demand from Chinese refiners has also contributed to the increase in prices.
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Also reported by 1 other outlet
- China’s Yuan Crude Oil Futures Jump to Record High finance.yahoo.com
