Muscat: Omani crude oil will be sold at more than $66 in the coming months, after its value at the Dubai Mercantile Exchange (DME) on December 17 for February 2020 crude oil futures contract reached $66.26.
A statement from the DME in this context said, “The marker price on December 17 for February 2020 Oman crude oil futures contract (OQD) is $66.26, with a change of $0.05.”
The price of Omani crude on the DME had been slowly moving forward over the past week. It was priced at $64.86 on December 10, before dipping slightly to $64.65 the next day. On December 12, it rose by nine cents to a price of $64.74, before rising by almost a dollar on December 13 to be priced at $65.68. On December 16, the price listed under the Oman crude oil futures contract was $66.21, before it rose to $66.26 on December 17.
Four territories use the DME’s Oman crude pricing, with Bahrain being the last to make the switch on October 28, 2018.
“Bahrain is the fourth national oil company (NOC) to implement DME Oman in its pricing formula,” said a statement from DME at that time. The DME Oman crude oil benchmark is currently used to establish the price of crude oil produced in the Kingdom of Saudi Arabia, the Sultanate of Oman, and the Emirate of Dubai.”
As of October 2019, the DME had organised the physical delivery of 17.496 million barrels of Oman crude oil, with the organisation adding, “DME hosts the largest physical delivery of any global commodities contract.”
“A daily marker price will be published at 16:30 Singapore time (12:30 Dubai Time, 02:30 Central Standard Time or 0330 Central Daylight Time),” said the DME explaining its pricing mechanism.
“This price represents the weighted average price of trades in the nearby contract month between 16:25 and 16:30 (Singapore time). The DME will also publish an end of trading day settlement price for all listed contract months, determined as at 13:30 Central Standard Time/Central Daylight Time.”