DME Oman trades below $100 first time over a year

04/09/2014 02:20 AST

DME, the Middle East’s premier international energy futures and commodities exchange, reported yesterday that its flagship Oman Crude Oil Futures Contract (DME Oman) traded below $100 per barrel for the first time in over a year. The front-month November DME Oman futures traded at a low of $99.39 per barrel before settling at $99.48 per barrel at 12:30 Dubai time, with more than 3,200,000 barrels traded during the window.

Yesterday’s price was $1.5 down from the previous day’s trade and is the lowest Marker Price since July 2013. The DME Marker Price is used by the governments of Oman and Dubai to calculate the Official Selling Price for crude oil exports.

Oman crude prices have trended lower since the second half of June, as the upheaval in Iraq largely left the key oil export regions in the south of the country untouched, while the downtrend continued after the International Energy Agency lowered its demand forecast for 2014, citing weaker-than-expected second-quarter economic growth in developed countries and a drop in oil stockpiling in China.

Christopher Fix, Chief Executive of DME, said: “We saw a one-year high of above $110/b in June, and now in September the lowest price for over a year. We are witnessing a significant revival in market volatility following a very stable first half to the year.” Launched in 2007, DME’s flagship Oman Crude Oil Futures Contract (DME Oman) contract 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, JP Morgan, Morgan Stanley, Shell, Vitol and Concord Energy also hold equity stakes in the DME.

Oman Daily Observer