OREANDA-NEWS. August 04, 2014. Recently, Industrial and Commercial Bank of China (“ICBC”) has introduced short selling of account-based crude oil in China, i.e., selling before buying trade.

This trading method meets investment requirements of customers in a diversified market environment. When expecting crude oil price to fall, customers can choose to be short.

To be short on paper crude oil, customers must sell account-based crude oil in their first transaction and then buy all or partial tranches of account-based crude oil no more than those sold. Prior to the first selling transaction, customers are required to transfer sufficient fund from their capital account to the margin account denominated in relevant currency. ICBC will freeze the fund in the margin account based on customers’ sales quantity until customers buy in to close out, and it will increase or deduct the balance in the margin account based on customers’ profit or loss. With 0.1 bucket as the starting point and the minimum increasing unit for both selling and buying account-based crude oil, account-based crude oil, under T+0, can be traded on a real-time basis or through a pending order as long as 120 hours. Customers may apply for trading, pending order and inquiry services through internet banking, mobile banking and telephone banking.

An official with ICBC said, ICBC debuted account-based crude oil for its personal customers in last March. With this new type of investment product, customers, by dealing in tranches instead of taking crude oil in kind, can conduct crude oil deals in RMB or USD to get gains from price differences. Afterwards, ICBC has been making greater efforts to innovate and successively rolled out account-based international crude oil and automaticcontract renewal function of account-based crude oil. With the short-selling ushered in, ICBC has basically covered all categories and functions of the account-based crude oil trade.