The growth of oil futures in China: Evidence of market maturity through global crises

Shaen Corbet, Hou, Yang (Greg), Yang Hu and Les Oxley

Energy Economics, 2022, vol. 114, issue C

Abstract: Chinese oil futures products were created in 2018, and have since presented an alternative, regional exchange through which to invest. This research tests for evidence of developing market maturity during the time since the market was established, specifically focusing on static and time-varying spillovers of higher moments between Chinese oil futures prices and other international crude oil markets. Chinese oil markets are also valuable when considering contagion and informational effects within the COVID-19 outbreak. Results indicate significant evidence of market maturity, to the extent that Chinese oil futures play a dominant role in the risk transmission of volatility, information asymmetry and extreme values, to both the international oil market and China’s domestic energy-related markets before the outbreak of the COVID-19. After the escalation of the COVID-19 pandemic, such maturity and informational effects deteriorate significantly. Such outcomes suggest that while Chinese oil futures markets were growing at pace to become a leading international oil product, the outbreak of COVID-19 has stalled such progress.

Keywords: Oil; Futures markets; Spillovers; Volatility; Information asymmetry; China (search for similar items in EconPapers)
JEL-codes: G00 G01 G10 G13 G14 G15 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:114:y:2022:i:c:s0140988322003863

DOI: 10.1016/j.eneco.2022.106243

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