China Launches Oil Benchmark: Milestone futures to attract more foreign investment
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The launch of the yuan-denominated crude oil futures represents a milestone for China's Futures Market. Experts say it is expected to attract more foreign investors to China. For the first time, foreign investors will have access to Chinese commodity futures. Margins of 500-thousand yuan or the equivalent in foreign currencies are required for individual investors, while the requirement for institutional investors is a margin of 1 million yuan or the equivalent in foreign currencies. The new futures are priced and settled in the Chinese yuan. Investors can use US dollars as a deposit and for settlement at the beginning. In the future, more currencies will be used as deposit.  Analysts believe the move will allow China - the world's largest energy consumer - to have more say in pricing crude sold to Asia.