Dr. Chu Juehai--Vice President of Shanghai Futures Exchange,President and CEO of Shanghai International Energy Exchange

Crude oil, an important component of the energy market, is the blood for industry, and a key bargaining chip in political, economic, military and diplomatic affairs. The current global crude oil market is undergoing changes, with new, crucial markets being formed in the Asia-Pacific region, represented by China, whose demand for crude has been growing rapidly, accounting for 33.8% of the world's total consumption in 2013 from the 21.1% in 1990, higher than those of North America and Europe. Meanwhile, Asia-Pacific, as one of the three net importing regions, is having a prominent trading status. However, it lacks a benchmark price which could reflect the local supply and demand accurately. Taking China as an example, China's crude import is taking the North American and European Crude Futures as the benchmarks for pricing, giving rise to problems of high import costs or incapability of covering exposures. The establishment of the Chinese crude futures helps to build a market pricing mechanism to protect the trade orders of the spot market, which is in accordance with the principle of allowing the market to play a decisive role in resource allocation outlined by the 3rd Plenum of the 18th CPC Central Committee.   

Meanwhile, after years of rapid development, China's futures market has grown in scale. China has become the biggest country, passing US, concerning the Commodity Futures Trading Volume. However, the domestic futures market is not open to overseas countries. Our price for oil has not been recognized by international market as the benchmark in cross-country trade. Relying on the opening-up of and the experiment in the Free Trade Pilot Zone, we are looking for a way leading us to a more globalized market, and let financial work serves the real economy better.

The listing of crude oil futures will accord with the fundamental framework of 'International platform, Net Price Trading, Bonded Delivery'. We will respond to risks with an open mind, and learn from other markets about making rules, supervising, operating, and controlling risks. We believe that Chinese characteristics and international customs will work together after all.