Dubai Mercantile Exchange grows trading volumes by 19% in 2011
The Dubai Mercantile Exchange Limited (“DME”) recorded year-on-year trading volume growth of 19% in 2011, it announced today.
The DME delivered more than 145 million barrels of crude oil during 2011, led by its flagship DME Oman Crude Oil Futures contract (“DME Oman”), but with a series of linked contracts adding to the performance. Within this growth figure is an underlying increase in Average Daily Volume (ADV) to 3,505 contracts per day, peaking at 4,427 per day in July. This represents the highest monthly ADV since the DME began trading in 2007. New records in total volume were also set in consecutive months during July and August, the latter seeing 95,440 contracts traded through the exchange.
Physical delivery of the DME Oman contract also grew through 2011, with an average of 12.115 million barrels of crude oil delivered each month and a new monthly record of 15.4 million barrels set in September. This underlying growth in physical delivery continues to demonstrate the DME’s strong linkage to the economic fundamentals of the market and reinforces DME Oman’s position as the world’s leading physically delivered crude oil futures contract.
Amid ongoing market volatility, the DME’s direct link to physical product continues to offer producers, consumers and end users a fair and transparent means of price discovery for crude oil bound for East of Suez markets. With the continued rapid, but uncertain, growth trajectory of Asian crude oil markets, DME Oman continues to provide participants with the tools required to manage risk and exposure to the sector effectively. The importance of these tools has been evidenced further through 2011 with the continued increase in the number of companies trading on the DME. Fifty six companies now trade regularly through the exchange, representing the key stakeholders in the East of Suez crude oil markets.
In September, the CFTC granted approval for DME performance bond requirements to be reduced from a two-day to a one-day calculation enabling customers to enjoy the same rates as those applied to the WTI and Brent contracts on CME Globex. This represents a significant benefit for DME customers.
Ahmad Sharaf, Chairman of the DME, commented:
“Our impressive performance over the past year is a powerful demonstration of the DME’s growing significance in the global crude oil market. The continued growth in volumes and in the number of trading participants shows the value that the market places on transparency, fair pricing and effective risk management offered by the DME. I am confident that as we move into another challenging year for the global economy, with the continued support of our shareholders, those benefits will stand the DME and our customers in good stead.”
Thomas Leaver, CEO of the DME, added:
“The past year’s performance shows the enduring value of the foundations upon which the DME and our Oman contract have been built. Especially during these turbulent times, there is a growing demand in markets East of Suez for Middle Eastern crude oil that is fairly and transparently priced.
“The DME continues to blaze a trail for others to follow. During the coming year it will be even more critically important to encourage better and fairer ways of pricing crude oil across global markets so that customer and participant confidence in the sector’s status as a core economic barometer is maintained and enhanced.”
Dubai Mercantile Exchange
The Dubai Mercantile Exchange Limited (DME) is the premier international energy futures and commodities exchange in the Middle East, providing a financially secure, well-regulated and transparent trading environment.
The DME is majority owned by core shareholders Tatweer (a subsidiary of Dubai Holding), Oman Investment Fund and CME Group. Global financial institutions and energy trading firms such as Goldman Sachs, J.P. Morgan, Morgan Stanley, Shell, Vitol and Concord Energy have taken equity stakes in the DME, providing the exchange with a resounding vote of confidence by major players in global energy markets.
The DME is a fully electronic exchange, and its contracts are listed on the CME Globex platform, the world’s leading electronic trading platform, providing access to the broadest array of futures and options products available on any exchange. The DME is regulated by the Dubai Financial Services Authority (DFSA) and all trades executed on the exchange are cleared through and guaranteed by NYMEX (a member of CME Group), which is regulated by the U.S. Commodity Futures Trading Commission (CFTC) and is a recognized body by the DFSA.
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