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INE has issued a circular on listing and trading of Low Sulfur Fuel Oil Futures Contracts, and published the Low Sulfur Fuel Oil Futures Contract and the Relevant Implementing Rules. Please refer to the text and attachment for details:
China Securities Regulatory Commission has approved Shanghai International Energy Exchange (hereinafter referred to as INE) to list Low Sulfur Fuel Oil futures contracts. In accordance with the relevant rules of INE, INE hereby notifies the concerning issues as follows:
1. Listing date
Low Sulfur Fuel Oil futures contracts start trading on June 22, 2020 with the central auction session from 8:55 a.m. to 9:00 a.m. and the market opens at 9:00 a.m..
2. Trading Hours
9:00 to 10:15, 10:30 to 11:30 and 13:30 to 15:00, Monday to Friday.
Continuous trading hours: 21:00 to 23:00, Monday to Friday.
There is no continuous trading session on the last working day (excluding weekends) preceding national holidays.
3. Listing Contracts
LU2101, LU2102, LU2103, LU2104, LU2105 and LU2106.
The last trading day for LU2101 will be December 24, 2020, and the delivery dates will be December 25 and from December 28 to December 31, 2020.
4. Listing price
The listing price for each contract will be released by INE on the trading day prior to the listing day.
5. Margin requirement and price limit
The trading margin for each contract is set as 15% of the contract value. The price limit for each contract is set as ±13% from the settlement price of the previous trading day, and the price limit on the first trading day will be twice the price limit.
An Overseas Special Non-Brokerage Participant or an overseas Client may use acceptable foreign exchange as margin. For foreign exchange to be used as margin, the current-day CNY Central Parity Rate published by China Foreign Exchange Trade System (hereinafter referred to as CFETS) shall be used as the benchmark prices for calculating the market value of the foreign exchange. Currently, INE accepts US Dollar as foreign currency collateral with a haircut of 5%.
Prior to the market close of the day, the market value of foreign exchange shall be calculated based on CFETS CNY Central Parity Rate published on the previous trading day. During the daily clearing, INE shall update the benchmark prices of the day and adjust the discounted value of foreign exchange used as margin according to the aforementioned methodology.
6. Disclosure of open interests
Once the open interests of a Low Sulfur Fuel Oil futures contract at the market close reaches 50,000 lots (one-sided), INE will disclose the trading volumes, long and short positions of the top 20 Futures Firm Members(hereinafter referred to as the “FF Members”) and Overseas Special Brokerage Participants(hereinafter referred to as the “OSBPs”).
7. Transaction fee
2 RMB yuan per lot, which is not waived for closing out the position opened on the same day.
All parties concerned shall get prepared for the listing of Low Sulfur Fuel Oil futures contracts and improve risk management to ensure the smooth functioning of the market.
Shanghai International Energy Exchange
June 10, 2020
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