Unipec, Shell ink deal on Middle East crude

Unipec, the trading arm of China Petroleum & Chemical Corp (Sinopec), China's largest oil refiner, has inked a deal with Royal Dutch Shell to buy Middle East crude priced against the newly-launched Shanghai crude futures contract, the company said on Wednesday.

Hong Kong-based Unipec Asia will buy the crude delivered to China for one year beginning in September, Sinopec said.

It is the first physical contract after the launch of Shanghai crude futures contract, which has further boosted the viability of China's first crude futures contract, as the world's largest oil importer aims at creating a benchmark to rival global price markers Brent and West Texas Intermediate (WTI), it said.

China launched trading of yuan-denominated crude oil futures contracts at the Shanghai International Energy Exchange on Monday, the first futures listed on China's mainland for overseas investors.

As many as 413 companies participated in the call auction, with the transaction price coming to 440 yuan ($70) per barrel Monday morning. The first companies to reach a deal included China National United Oil Corporation, Unipec Asia Co Ltd and Glencore Singapore Pate Ltd.

There were 15 contracts publicly traded Monday. Transaction deposit is set at 7 percent of the contract value, and the daily limit of price fluctuation is 5 percent.