MCX hikes crude margins as risk of negative pricing looms

Mumbai: MCXNSE 6.70 %’s clearing corporation, MCXCCL, has sharply raised the margins clients need to put up for trading crude oil derivatives effective April 30.

The initial margin has been fixed at Rs 95,000 a lot (100 barrels) for all existing and yet to be launched contracts. For near-month contracts, an additional Rs 1 lakh a lot will be levied . This will also apply to short side — call and put sellers — of the near-month crude oil options contacts .

Additionally, a 50 per cent margin will be levied on other crude futures contracts and on sellers of calls and put options.

Effectively, the near-month margin to trade will rise to minimum Rs 1.95 lakh a lot. The margin used to be Rs 60,000-70,000 days ago.