DME authorises LCs for trading by Rabobank

06/08/2014 01:41 AST

Netherlands headquarters Rabobank has been authorised to issue Letters of Credit (LCs) for trading on the Dubai Mercantile Exchange (DME) directly from Singapore, the energy futures and commodities exchange announced yesterday. The approval marks the culmination of extensive joint efforts to facilitate trading activities of DME’s and Rabobank’s mutual customers in Asia.

Rabobank will now be able to issue Letters of Credit directly from Singapore to guarantee deliveries of Oman Blend crude oil through the DME, helping to create a more efficient, cost-effective and reliable trading ecosystem around the Exchange.

Christopher Fix, Chief Executive of DME, said: “Asian markets have been driving the bulk of global demand and have formed the fulcrum of DME’s sustained growth, and our success in creating a robust financing framework that effectively addresses the trading needs of our customers in Asia will further add to our customer value proposition. DME has seen a steady upturn in volumes as well as in new trading participants, and we are committed to supporting the needs of our expanding customer base by providing them with a thriving and sustainable trading environment.”

Launched in 2007, DME has rapidly grown into a globally relevant exchange. Its flagship Oman Crude Oil Futures Contract (DME Oman) is now firmly established as the most credible crude oil benchmark relevant to the rapidly growing East of Suez market. Reflecting the economics of the Asian region like no other contract, and the largest physically delivered crude oil futures contract in the world, DME Oman is the world’s third crude oil benchmark and the sole benchmark for Oman and Dubai exported crude oil.

DME is a joint venture between Dubai Holding, Oman Investment Fund and CME Group. Global financial institutions and energy trading firms including Goldman Sachs, JPMorgan, Morgan Stanley, Shell, Vitol and Concord Energy also hold equity stakes in the DME.

Oman Daily Observer