China is seeking to assert its growing influence on global oil markets with a yuan-denominated crude futures contract expected to be launched this year.
At the same time, analysts warn that the second-largest oil consumer after the United States will struggle to compete with more established benchmarks such as London’s Brent North Sea crude and New York’s WTI.
“China is the world’s largest oil importer and is going to become the largest oil consumer in the future, so it makes sense for the country to be the place for an oil futures (contract) in Asia,” Lin Boqiang, director of the Energy Economics Research Centre at Xiamen University, told AFP.
China’s consumption will exceed that of the United States by 2034, according to the US Energy Information Administration. The country produced about 4.6 million barrels per day (mbpd) of oil in 2014, while the country’s average net imports reached 6.1 mbpd.