dubai mercantile exchange

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Dubai Mercantile Exchange

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Type Joint VentureIndustry Commodities Exchange

Founded 2005

Location Dubai, United Arab Emirates

Products Energy Futures

Owners

Tatweer,Oman Investment Fund,

CME Group and other

global financial institutions

and energy trading firms

Website www.dubaimerc.com

The Dubai Mercantile Exchange (DME) is acommodity exchangebased inDubaicurrently

listing its flagshipfutures contract,DME Oman Crude Oil Futures Contract(OQD). Launched in

2007, the DME aims to become the crude oil pricingbenchmarkfor the Asian market with itsOman Crude Oil contract, like theIntercontinental Exchanges (ICE)North Sea Brentis to

Europe and theNew York Mercantile Exchanges (NYMEX)West Texas Intermediateis to

North America.

The choice of the OQD contract as a benchmark was due to several important attributes of thecrude oil itself and its infrastructure as opposed to the volume of export in comparison with other

Middle East crudes. Firstly, the Omani crude oil is not subject to OPEC production quotas and/orcuts, nor is it subject to destination restrictions. Secondly, the geographical location of the export

portMina al Fahal(operated byPetroleum Development Oman- PDO),in Muscat into the Gulf

of Oman, is past theStrait of Hormuz. Other reasons such as the increasing long-term productionlevels and investments, as well as the quality of the crude, helped tip the balance in favor of that

crude to be used as a benchmark.

The DME is located in theDubai International Financial Center, (afinancial free zonein Dubai),

and is regulated by theDubai Financial Services Authority. The USCommodity Futures Trading

Commission(CFTC) issued a No Action Letter in 2007, allowing US customers to trade DMEcontracts. The DME has received further regulatory approval in 23 jurisdictions.

Contents

1 Company Evolution 2 Futures Contract
http://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#mw-headhttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#mw-headhttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#mw-headhttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#p-searchhttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#p-searchhttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#p-searchhttp://en.wikipedia.org/wiki/Oman_Investment_Fundhttp://en.wikipedia.org/wiki/Oman_Investment_Fundhttp://en.wikipedia.org/wiki/Oman_Investment_Fundhttp://en.wikipedia.org/wiki/Commodities_exchangehttp://en.wikipedia.org/wiki/Commodities_exchangehttp://en.wikipedia.org/wiki/Commodities_exchangehttp://en.wikipedia.org/wiki/Dubaihttp://en.wikipedia.org/wiki/Dubaihttp://en.wikipedia.org/wiki/Dubaihttp://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/DME_Oman_Crude_Oil_Futures_Contracthttp://en.wikipedia.org/wiki/DME_Oman_Crude_Oil_Futures_Contracthttp://en.wikipedia.org/wiki/DME_Oman_Crude_Oil_Futures_Contracthttp://en.wikipedia.org/wiki/Benchmark_%28crude_oil%29http://en.wikipedia.org/wiki/Benchmark_%28crude_oil%29http://en.wikipedia.org/wiki/Benchmark_%28crude_oil%29http://en.wikipedia.org/wiki/Intercontinental_Exchangehttp://en.wikipedia.org/wiki/Intercontinental_Exchangehttp://en.wikipedia.org/wiki/Intercontinental_Exchangehttp://en.wikipedia.org/wiki/Brent_Crudehttp://en.wikipedia.org/wiki/Brent_Crudehttp://en.wikipedia.org/wiki/Brent_Crudehttp://en.wikipedia.org/wiki/New_York_Mercantile_Exchangehttp://en.wikipedia.org/wiki/New_York_Mercantile_Exchangehttp://en.wikipedia.org/wiki/New_York_Mercantile_Exchangehttp://en.wikipedia.org/wiki/West_Texas_Intermediatehttp://en.wikipedia.org/wiki/West_Texas_Intermediatehttp://en.wikipedia.org/wiki/West_Texas_Intermediatehttp://en.wikipedia.org/wiki/Mina_al_Fahalhttp://en.wikipedia.org/wiki/Mina_al_Fahalhttp://en.wikipedia.org/wiki/Mina_al_Fahalhttp://en.wikipedia.org/wiki/Petroleum_Development_Omanhttp://en.wikipedia.org/wiki/Petroleum_Development_Omanhttp://en.wikipedia.org/wiki/Petroleum_Development_Omanhttp://en.wikipedia.org/wiki/Strait_of_Hormuzhttp://en.wikipedia.org/wiki/Strait_of_Hormuzhttp://en.wikipedia.org/wiki/Strait_of_Hormuzhttp://en.wikipedia.org/wiki/Dubai_International_Financial_Centerhttp://en.wikipedia.org/wiki/Dubai_International_Financial_Centerhttp://en.wikipedia.org/wiki/Dubai_International_Financial_Centerhttp://en.wikipedia.org/wiki/Free_economic_zonehttp://en.wikipedia.org/wiki/Free_economic_zonehttp://en.wikipedia.org/wiki/Free_economic_zonehttp://en.wikipedia.org/w/index.php?title=Dubai_Financial_Services_Authority&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Dubai_Financial_Services_Authority&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Dubai_Financial_Services_Authority&action=edit&redlink=1http://en.wikipedia.org/wiki/Commodity_Futures_Trading_Commissionhttp://en.wikipedia.org/wiki/Commodity_Futures_Trading_Commissionhttp://en.wikipedia.org/wiki/Commodity_Futures_Trading_Commissionhttp://en.wikipedia.org/wiki/Commodity_Futures_Trading_Commissionhttp://en.wikipedia.org/wiki/No-action_letterhttp://en.wikipedia.org/wiki/No-action_letterhttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#Company_Evolutionhttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#Company_Evolutionhttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#Futures_Contracthttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#Futures_Contracthttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#Futures_Contracthttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#Company_Evolutionhttp://en.wikipedia.org/wiki/No-action_letterhttp://en.wikipedia.org/wiki/Commodity_Futures_Trading_Commissionhttp://en.wikipedia.org/wiki/Commodity_Futures_Trading_Commissionhttp://en.wikipedia.org/w/index.php?title=Dubai_Financial_Services_Authority&action=edit&redlink=1http://en.wikipedia.org/wiki/Free_economic_zonehttp://en.wikipedia.org/wiki/Dubai_International_Financial_Centerhttp://en.wikipedia.org/wiki/Strait_of_Hormuzhttp://en.wikipedia.org/wiki/Petroleum_Development_Omanhttp://en.wikipedia.org/wiki/Mina_al_Fahalhttp://en.wikipedia.org/wiki/West_Texas_Intermediatehttp://en.wikipedia.org/wiki/New_York_Mercantile_Exchangehttp://en.wikipedia.org/wiki/Brent_Crudehttp://en.wikipedia.org/wiki/Intercontinental_Exchangehttp://en.wikipedia.org/wiki/Benchmark_%28crude_oil%29http://en.wikipedia.org/wiki/DME_Oman_Crude_Oil_Futures_Contracthttp://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/Dubaihttp://en.wikipedia.org/wiki/Commodities_exchangehttp://en.wikipedia.org/wiki/Oman_Investment_Fundhttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#p-searchhttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#mw-head


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3 See also 4 External links

Company Evolution

The exchange was initially started in 2005, whenTatweerandNYMEXsigned aJoint Venture

Agreement to launch a commodities exchange in the Middle East. The following year,OmansMinistry of Oil and Gas(MOG) announced that the Omani crude oils official selling price

(OSP) exported through PDO would be set according to the DME Oman Crude Oil Futures

contract. In the first half of 2007,Oman Investment Fund(OIF) acquired a stake in the DME,which was launched on 1st June of that year.

Two major events in 2008 that notably changed the DMEs shareholding structure; several

trading firms and international financial institutions, namelyConcord Energy,Goldman Sachs,JPMorgan Chase,Morgan Stanley,ShellandVitol, became shareholders of the DME, and

NYMEX was acquired by theCME Group.

The acquisition of NYMEX by the CME Group greatly impacted the DME. Until the DME

migration to theelectronic trading platformCMEGlobexin 2009, DME futures used to be

traded on DME Direct, an electronic platform designed by NYMEX specifically for the DME.The switch to one of the leading platforms, CME Globex, in February 2009 has helped make the

access to the DME contracts easier for market participants, as all three benchmarks (WTI, Brent

and DME Oman) can be traded on the same electronic platform.

Another boost for the DME in 2009 was the announcement by the Dubai Department ofPetroleum Affairs (DPA) in switching their pricing formula to the forward public OSP based on

the DME contract. That meant that the Dubai crude oil selling price would become:

OSP = DME Oman (-2) differential

In December 2010, NYMEX announced the launch of six DME Oman-linked contracts tocomplement the availability of trading instruments so as to help establish the benchmark.

Futures Contract

The DMEs flagship contract is the Oman Crude Oil Futures Contract, launched on the 1st June

2007, which became the largest physically delivered crude oil contract in the region. The

physical settlementof the contract gives it a unique aspect whereby the front trading month istwo months forward (e.g.: the March contract is the front month during January trading).

Total number of barrels traded per year on the Dubai Mercantile Exchange through the Oman

Crude Oil Futures Contract:
http://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#See_alsohttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#See_alsohttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#External_linkshttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#External_linkshttp://en.wikipedia.org/wiki/Tatweerhttp://en.wikipedia.org/wiki/Tatweerhttp://en.wikipedia.org/wiki/Tatweerhttp://en.wikipedia.org/wiki/NYMEXhttp://en.wikipedia.org/wiki/NYMEXhttp://en.wikipedia.org/wiki/NYMEXhttp://en.wikipedia.org/wiki/Joint_Venturehttp://en.wikipedia.org/wiki/Joint_Venturehttp://en.wikipedia.org/wiki/Joint_Venturehttp://en.wikipedia.org/w/index.php?title=Oman%E2%80%99s_Ministry_of_Oil_and_Gas&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Oman%E2%80%99s_Ministry_of_Oil_and_Gas&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Oman%E2%80%99s_Ministry_of_Oil_and_Gas&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Oman%E2%80%99s_Ministry_of_Oil_and_Gas&action=edit&redlink=1http://en.wikipedia.org/wiki/Oman_Investment_Fundhttp://en.wikipedia.org/wiki/Oman_Investment_Fundhttp://en.wikipedia.org/wiki/Oman_Investment_Fundhttp://en.wikipedia.org/w/index.php?title=Concord_Energy&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Concord_Energy&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Concord_Energy&action=edit&redlink=1http://en.wikipedia.org/wiki/Goldman_Sachshttp://en.wikipedia.org/wiki/Goldman_Sachshttp://en.wikipedia.org/wiki/Goldman_Sachshttp://en.wikipedia.org/wiki/JPMorgan_Chasehttp://en.wikipedia.org/wiki/JPMorgan_Chasehttp://en.wikipedia.org/wiki/Morgan_Stanleyhttp://en.wikipedia.org/wiki/Morgan_Stanleyhttp://en.wikipedia.org/wiki/Morgan_Stanleyhttp://en.wikipedia.org/wiki/Royal_Dutch_Shellhttp://en.wikipedia.org/wiki/Royal_Dutch_Shellhttp://en.wikipedia.org/wiki/Royal_Dutch_Shellhttp://en.wikipedia.org/wiki/Vitolhttp://en.wikipedia.org/wiki/Vitolhttp://en.wikipedia.org/wiki/Vitolhttp://en.wikipedia.org/wiki/CME_Grouphttp://en.wikipedia.org/wiki/CME_Grouphttp://en.wikipedia.org/wiki/CME_Grouphttp://en.wikipedia.org/wiki/Electronic_trading_platformhttp://en.wikipedia.org/wiki/Electronic_trading_platformhttp://en.wikipedia.org/wiki/Electronic_trading_platformhttp://en.wikipedia.org/wiki/Globexhttp://en.wikipedia.org/wiki/Globexhttp://en.wikipedia.org/wiki/Globexhttp://en.wikipedia.org/wiki/Settlement_%28finance%29http://en.wikipedia.org/wiki/Settlement_%28finance%29http://en.wikipedia.org/wiki/Settlement_%28finance%29http://en.wikipedia.org/wiki/Globexhttp://en.wikipedia.org/wiki/Electronic_trading_platformhttp://en.wikipedia.org/wiki/CME_Grouphttp://en.wikipedia.org/wiki/Vitolhttp://en.wikipedia.org/wiki/Royal_Dutch_Shellhttp://en.wikipedia.org/wiki/Morgan_Stanleyhttp://en.wikipedia.org/wiki/JPMorgan_Chasehttp://en.wikipedia.org/wiki/Goldman_Sachshttp://en.wikipedia.org/w/index.php?title=Concord_Energy&action=edit&redlink=1http://en.wikipedia.org/wiki/Oman_Investment_Fundhttp://en.wikipedia.org/w/index.php?title=Oman%E2%80%99s_Ministry_of_Oil_and_Gas&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Oman%E2%80%99s_Ministry_of_Oil_and_Gas&action=edit&redlink=1http://en.wikipedia.org/wiki/Joint_Venturehttp://en.wikipedia.org/wiki/NYMEXhttp://en.wikipedia.org/wiki/Tatweerhttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#External_linkshttp://en.wikipedia.org/wiki/Dubai_Mercantile_Exchange#See_also


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2007* 200,892,000 barrels

2008 322,294,000 barrels

2009 551,866,000 barrels

2010 744,727,000 barrels

* the exchanged opened on the 1st June 2007.1,000 barrels = 1 lot (or contract).Figures are

from the DME website

With over 144 million barrels delivered through the exchange in 2010 and more than 50companies trading the contract regularly, it seems that the DME Oman oil benchmark has been

accepted by market participants as a regulated and transparent benchmark for theEast of Suezmarket.

See also

CME Group The Chicago Mercantile Exchange NYMEX DME Oman Crude Oil Futures Contract Commodity Futures Trading Commission Dubai Financial Services Authority Petroleum Development Oman List of futures exchanges List of traded commodities
http://en.wikipedia.org/wiki/East_of_Suezhttp://en.wikipedia.org/wiki/East_of_Suezhttp://en.wikipedia.org/wiki/East_of_Suezhttp://en.wikipedia.org/wiki/CME_Grouphttp://en.wikipedia.org/wiki/CME_Grouphttp://en.wikipedia.org/wiki/The_Chicago_Mercantile_Exchangehttp://en.wikipedia.org/wiki/The_Chicago_Mercantile_Exchangehttp://en.wikipedia.org/wiki/NYMEXhttp://en.wikipedia.org/wiki/NYMEXhttp://en.wikipedia.org/wiki/DME_Oman_Crude_Oil_Futures_Contracthttp://en.wikipedia.org/wiki/DME_Oman_Crude_Oil_Futures_Contracthttp://en.wikipedia.org/wiki/Commodity_Futures_Trading_Commissionhttp://en.wikipedia.org/wiki/Commodity_Futures_Trading_Commissionhttp://en.wikipedia.org/w/index.php?title=Dubai_Financial_Services_Authority&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Dubai_Financial_Services_Authority&action=edit&redlink=1http://en.wikipedia.org/wiki/Petroleum_Development_Omanhttp://en.wikipedia.org/wiki/Petroleum_Development_Omanhttp://en.wikipedia.org/wiki/List_of_futures_exchangeshttp://en.wikipedia.org/wiki/List_of_futures_exchangeshttp://en.wikipedia.org/wiki/List_of_traded_commoditieshttp://en.wikipedia.org/wiki/List_of_traded_commoditieshttp://en.wikipedia.org/wiki/List_of_traded_commoditieshttp://en.wikipedia.org/wiki/List_of_futures_exchangeshttp://en.wikipedia.org/wiki/Petroleum_Development_Omanhttp://en.wikipedia.org/w/index.php?title=Dubai_Financial_Services_Authority&action=edit&redlink=1http://en.wikipedia.org/wiki/Commodity_Futures_Trading_Commissionhttp://en.wikipedia.org/wiki/DME_Oman_Crude_Oil_Futures_Contracthttp://en.wikipedia.org/wiki/NYMEXhttp://en.wikipedia.org/wiki/The_Chicago_Mercantile_Exchangehttp://en.wikipedia.org/wiki/CME_Grouphttp://en.wikipedia.org/wiki/East_of_Suez

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