Supporters of the traditional way of buying and selling oil with shouted out trades on a market floor – or pit – have a new place to do that. The New York Mercantile Exchange – NYMEX – has set up in Dublin to challenge London’s International Petroleum Exchange. The IPE favours electronic trading to the open outcry method. NYMEX President James Newsome said: “There are benefits to both depending on what product area you are working at. When you look at the complexity of the energy products that we all work (with), our customers feel they get more value from trading open outcry.” Many London traders do not like the way IPE is cutting back trading hours for open outcry.Deirdre Lyons, of the Irish government’s Investment and Development Agency, said they have done a lot to bring NYMEX there: “This is a really exciting day for Dublin. We built this building 10 years ago so that exchanges could come to Dublin to trade and they could see it wasn’t necessary to be in London to trade. We’ve put together a package of incentives that include working with the regulator, tax options and a whole infrastructure in place.” NYMEX too is offering incentives. It has waived the traders usual fees for three months and paying more than 3,000 euros a month relocation costs. London responded by cutting its fees.
NY launches Dublin challenge to London oil trading