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MCX Launches Crude Oil Mini Future Contracts From March 3, 2023  

03 March 20236 mins read by Angel One
MCX launches new Crude Oil Mini futures contracts with reduced lot size of 10 barrels. Read on to know all the details regarding the new contracts. 
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The Multi-Commodity Exchange (MCX) of India has introduced Crude Oil Minis from March 3, 2023. These are small-size contracts with smaller minimum lot sizes (in the case of crude mini, 10 barrels/lot) to encourage smaller traders and dealers to trade in these goods or hedge against market volatilities more effectively.

Crude Oil Minis were discontinued by the MCX earlier in 2019.

Launch calendar of the Crude Oil Mini Futures Contracts

The exchange has announced the launch dates and respective expiry months of the Crude Oil Mini futures for the upcoming months as follows. 

Contract Month  Contract launch date Expiry date 
April 2023 March 3, 2023 April 19, 2023
May 2023 March 3, 2023 May 19, 2023
June 2023 March 3, 2023 June 16, 2023
July 2023 March 3, 2023 July 19, 2023
August 2023 March 3, 2023 August 21, 2023
September 2023 March 21, 2023 September 19, 2023
October 2023 April 20, 2023 October 19, 2023
November 2023 May 22, 2023 November 17, 2023
December 2023 June 19, 2023 December 18, 2023

Recently, MCX announced Aluminium, Lead, and Zinc Minis. We have covered the details in our blog “MCX Launches 3 New Mini Contracts of Aluminium, Lead and Zinc.”

The Minis will offer significant advantages and empowerment to traders and suppliers who prefer to deal in smaller quantities. The contract is much smaller than the usual lot size of 100 barrels. Traders can take advantage of the Mini contracts from March 3, 2023. 

For your knowledge, there are two kinds of Crude Oil contracts available – Crude Oil and Crude Oil Mini contracts. 

  • The two types of contracts vary in lot sizes. The standard lot size is 100 barrels, but the newly launched Crude Oil Mini futures contracts have a minimum lot size of 10 barrels.
  • However, each of them has a lasting period of 6 months. 
  • The expiry is usually on the 19th of each month. For the exact date, consult the table given above. 
  • Arbitraging between two Crude Oil future contracts are allowed, provided they are of the same value.

Key details relevant to the Crude Oil Mini Contracts 

Symbol CRUDEOILM
Description CRUDEOILMMMMYY
Trading Units  10 barrels 
Quotation/Base value ₹ Per barrel
Maximum order size  10,000 barrels
Ticket size (minimum price movement) ₹1
Initial Margin Minimum 10% or SPAN value whichever is higher 
Extreme Loss Margin 1% minimum
Maximum allowable open positions For individual clients, 5% of the market wide open position or 4,80,000 barrels, whichever is higher, for all Crude Oil contracts

combined together

For a member collectively for all clients, 20% of the market wide open position or 48,00,000

barrels, whichever is higher for all Crude Oil contracts combined together

Settlement Mechanism All contracts are cash settled 

Also read: What is MCX & How to Trade?

Final words

Crude Oil is one of the most actively-traded commodities on the MCX exchange. The purpose of introducing Crude Oil Mini contracts is to allow more trading opportunities for individuals. Since Crude Oil contracts are highly liquid, these will offer an added advantage to the participating traders, who will benefit from the reduced lot size to minimise their exposure risk. If you want to invest in the commodity market, open a Demat account with Angel One – one of the most trusted brokerages in India.  

Disclaimer: This article has been written exclusively for educational purposes. The securities quoted are only examples and not recommendations.

Source: https://www.mcxindia.com/docs/default-source/circulars/english/2023/february/circular-146-2023.pdf?sfvrsn=347ad591_0

 

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