The first day of trading for China oil futures can be described as a success.
Volume was relatively strong at 42’336, with most of it concentrated on the first trading month (September 2018 with a volume of 40’656). The large trading companies with a strong presence in China made it a point to participate right from the opening of the session, to prove that it is not a contract limited to local speculators.
The Open Interest at 3’558 contracts is still small but this is a first day and given that the first contract month is only for September, it leaves a lot of time to increase Open Interest. Most of the Open Interest is on the front September month (3’114).
Pricing wise, it is difficult to draw conclusions on a first trading day that was adjusting to the launch quote. September closed the first session at 429.9 RMB/bbl (about 68.12$/bbl), The Sep-Oct spread closed with a backwardation of 0.60 $/bbl. The backwardation is on the high side compared to the other benchmarks.