Light sweet oil contract launched

National Commodity and Derivatives Exchange has launched a deliverable futures contract in light sweet crude oil today, the exchange said in a circular. Contracts for delivery in September, October and November began trading today.

The Jawaharlal Nehru Port Trust has been designated as the delivery centre. The trading unit will be 100 barrels, while the delivery unit is 50,000 barrels.

"The buyer shall be responsible for the freight cost, insurance, import duty and all other taxes and levies on actual basis," the exchange said. Traders have to give delivery intention during the last three days of trading in the contract.

The daily price fluctuation limit will be 6 per cent, and if it is reached intraday it would be extended by 3 per cent after 15 minutes. The position limit for members has been set at 1.2 million barrels and that for a client will be 4,00,000 barrels.

The above position limits do not apply to bonafide hedgers and the exchange will set limits for them on a case-to-case basis.

MCX already offers a non-deliverable West Texas Intermediate crude oil contract benchmarked against a contract on the New York Mercantile Exchange.

Both MCX and Ncdex also trade a Brent crude oil contract.