Uranium options contract may follow futures-NYMEX

LONDON Tue May 22, 2007 5:21pm BST

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LONDON May 22 (Reuters) - The New York Mercantile Exchange (NYMEX) said on Tuesday its newly introduced uranium futures contract could be followed by an options contract.

The exchange, which is a subsidiary of NYMEX Holdings NMX.N, launched a uranium futures contract <0#UXX:> on May 7. Once volumes picked up NYMEX would consider option trading.

"We have already seen a lot of interest," Senior Director of Metals Marketing Patricia H. Cauley told Reuters at a seminar.

Together with a higher volume in the uranium futures contract it was also necessary to see the result after other option contracts that were being introduced next month.

NYMEX will offer options trading for crude oil, natural gas, gold and silver on its CME Globex electronic trading platform beginning on June 24.

American-style options are contracts that may be exercised at any time before expiry. They differ from European-style options contracts, which may be exercised only on the expiry date.

"We have to see how these work technically and then we have to make a decision on uranium," Cauley said during the NYMEX UxC Uranium seminar in London.

"Options are easier to trade and so they could target a broader audience," she added.

NYMEX and UxC, a top publisher of uranium prices and price forecasts, launched the financially settled uranium futures contract in May to improve price discovery and make the market more transparent.

The 250-pounds contract is listed for 36 consecutive months, and is settled on the spot month-end U3O8 price published by the UxC.

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