He doesn’t expect the Chinese contract to soon steal much, if any, volume from either, as “they are simply too well-established, globally acceptable benchmarks.”

Still, Corley adds, given that China is one of the world’s largest oil consumers, if the contract succeeds, that would “indeed provide China with more pricing power, much to the dismay of their primary suppliers, the Middle East producers.”

This report also appears at Barrons.com. The most actively traded futures contract due for delivery in September closed up 3.3% at 429.9 yuan ($68.07) per barrel on the Shanghai International Energy Exchange, after opening up more than 6% from a starting reference point of 416 yuan per barrel. See: China faces hurdles as it vies with U.S. in oil-futures market

On Monday, Brent crude-oil futures UK:LCOK8 — the global benchmark based in London — were trading at $70.46 per barrel, while West Texas Intermediate futures US:CLK8 , the U.S. version, were trading at $65.68 per barrel.
China launches an oil futures market, with contracts denominated in yuan, in a bid to compete with oil benchmarks from the United States and Europe.