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Financials

UPDATE 1-China's INE adds PetroChina storage as futures warehouse, doubles storage fee

(Adds context, total warehouse space; storage fee raise)

SINGAPORE, April 16 (Reuters) - China’s Shanghai International Energy Exchange (INE) said on Thursday it has added another 1.2 million cubic metres of PetroChina’s storage in the northeastern port of Dalian as delivery tanks for crude oil futures.

This brings the exchange’s total warehouse capacity for crude oil futures to 5.9 million cubic metres, or about 37.2 million barrels, marking an increase of two-thirds in just over three weeks as the exchange attempts to meet rising demand for crude oil deliveries.

In a separate statement, the exchange also said it will adjust the storage fee for delivery tanks to 0.4 yuan ($0.0565) per day per barrel, effective June 15.

That is double an earlier rate, an INE official said.

INE will first use 800,000 cubic metres (about 5.04 million barrels) of the Dalian tank farm for futures deliveries, the exchange said in a statement.

Reuters reported in early April that oil traders seeking to take advantage of a price anomaly by delivering crude into Shanghai crude futures contracts are unable to do so as storage designated by the exchange is full.

Some investors are holding onto their warehouse receipts as INE’s storage costs are relatively low.

The latest storage addition follows similar moves in the last two weeks as the exchange approved tank farms in Yangpu, Rizhao and Dalian to boost the warehouse space.

China launched its internationalised yuan-denominated crude oil futures contract in March 2018 with the aim of establishing an Asian oil price benchmark. ($1 = 7.0755 Chinese yuan renminbi) (Reporting by Chen Aizhu; Editing by Toby Chopra and Kim Coghill)

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