Rise of the Oman crude benchmark The rise of the Brent crude benchmark at the expense of its rival West Texas Intermediate is already well documented. But a new trend is emerging: the steady growth of Oman crude, the fledgling benchmark at the Dubai Mercantile Exchange. Although the Oman futures contract's trading volume remains small compared with Brent - the global benchmark - or WTI - the US crude contract - the growth in transactions is accelerating. Last month, daily volumes jumped several times above the key level of 10,000 lots. The 10,000 lots per day threshold is very important because oil-producing nations such as Saudi Arabia have in the past indicated that was the level they needed to see on a sustained basis to consider using the contract as a pricing benchmark for their sales into Asia. For the past 25 years, Gulf-based oil producers have priced their sales to Asia against the cost of Dubai crude in the physical market. The Dubai benchmark was so important that is was known as the "Brent of the east," but as production declined, its market became more opaque and illiquid. Although Platts, the oil pricing agency, has tried to resolve the liquidity problem, many say the benchmark is in its final days. The slow death of the Dubai benchmark is opening a rare window of opportunity for Oman to take over as the benchmark of Asia-bound oil sales. The contract still has a long way to go in achieving that status, however. Average daily volumes in April stood at 6,158 lots, up 50 per cent year on year, although still below the crucial 10,000 number as trading dipped several days. But executives say that if current trends continue, it could hit a monthly daily average of 10,000 lots before the end of the year. That would put it on par with the current volume of transactions for Dubai, concentrated around the Dubai inter-month swaps and the Dubai-Brent exchange of futures for swaps. The success of Oman comes after a long history of failure. Several exchanges, both in London and Singapore, launched a futures contract for Middle East crude in the 1990s, but they failed to gain traction. Five years ago two rival exchanges launched two Dubai-based contracts: the ICE Middle East crude, which failed, and the Nymex Dubai crude, which is showing signs of establishing itself as a potential benchmark. The success vindicates the optimism of Gary King, DME's first chief executive, who five years ago was upbeat despite a slow start. "Over time, this contract will be adopted by the industry," he said at the time. The key for the future of Oman as a benchmark is mostly in the hands of Saudi Arabia, as Bassam Fattouh of the Oxford Institute of Energy Studies has argued on his recent report The Dubai Benchmark and Its Role in the International Oil Pricing System. If Riyadh decides to use Oman crude futures to price sales into Asia on the back of rising, even if not stellar, trading activity, the contract would climb to the category of global benchmark overnight. If Saudi Arabia fails to come through, the Oman contract would most probably continue building its trading activity, but remain short of a global benchmark title.