China made its long-anticipated oil futures debut on Monday, and the yuan-denominated futures surged. China imports about 600 kb/d of Oman crude.
In Asia, meanwhile, today saw the launch of Shanghaicrude oil futures, potentially marking the dawn of a new oil price benchmark to rival dominant Brent and West Texas Intermediate (WTI).
The Shanghai International Energy Exchange has allocated a total storage capacity of 5.95 million cubic meters (37.42 million barrels) at six sites along China's coast to receive crude under these contracts.
Futures for September settlement opened at 440 yuan a barrel, up from a reference price of 416 yuan.
That came after Brent futures for May delivery opened above $70 per barrel for the first time since January, boosted by expectations that OPEC-leader Saudi Arabia may extend supply cuts into 2019, as well as concerns that the United States may re-introduce sanctions against Iran.
China's treasury bond futures closed mixed on Monday, with the contract for June 2018 closing 0.05 percent lower at 96.98 yuan (about 15.34 US dollars).
China's launch on Monday of its crude futures exchange will improve the clout of the yuan in financial markets and could threaten the worldwide primacy of the dollar, argues a new report by Hayden Briscoe, APAC head of fixed income at UBS Asset Management. Both futures contracts are commonly used by financial traders.
The new contracts are "rooted in China's ambition to increase its bargaining power to price energy supplies amidst an increasing reliance on oil imports", energy industry information provider ICIS said in a research note.
The country also hopes that yuan-denominated futures contracts will help its currency play a bigger role in the global economy.
Speculative retail and institutional investors also propped up the launch-day's liquidity, said Chen Tong, Shanghai-based senior crude analyst at First Futures.
The early involvement of big global traders was a morale boost to the fledging market, but state oil majors like PetroChina and Sinopec are expected to provide a significant amount of liquidity in the long-term.
At the end of afternoon session, Shanghai prices were up 3.34 percent at 430.2 yuan, with 40,656 lots traded.
Nevertheless, the existing price benchmarks - Brent and WTI crude - are both in dollars, and importers across the world must buy dollars in order to conduct oil deals.
The possibility of a full-blown trade war between the U.S. and China battered Asian shares on Monday. Chinese exchanges count each way of the trade - the buy and sell - as two lots.