Two rival attempts to create a benchmark futures contracts to trade Middle East crude oil are struggling after attracting only poor investor interest.

Trading volumes in the two contracts, launched three months ago, evaporated in August and traders said they were now unlikely to recover significantly after the holiday period.

The failure to draw interest, in particular from Asian refineries, is the latest setback to create a Middle East benchmark that could compete with Brent and West Texas Intermediate.

The rival Middle East contracts were launched in June by the US-based InterContinental Exchange and the Dubai Mercantile Exchange, a joint venture between the New York Mercantile Exchange and Dubai and Oman governments.

“The contracts have failed to attract enough critical mass,” said a trader involved in both contracts. “There is not enough interest both from the sellers in the Gulf region and from the buyers among the Asian refineries side.”

The ICE Middle East contract even failed to trade on three separate days last month and the DME’s Oman contract traded just 25 lots one day in August. Volumes in both Brent and WTI are usually well above 50,000 lots.

However, Gary King, DME chief executive, said that trading volume would now recover. “Over time, this contract will be adopted by the industry,” he said.

DME Oman crude oil volumes fell to an average of less than 160 trades a day in August, down from about 600 in July and almost 1,900 in June. ICE Middle East crude volumes shrank to fewer than 50 trades a day in August, down from about 2,000 in June.

Mr King said Asian refineries would embrace the contracts in the long term. “It always has been the case that Asia [refineries] are price followers rather than settlers. This would take some time,” he said.

DME Oman volumes on Tuesday jumped thanks to a programme with financial incentives for market makers to increase trading volumes, traders said.

Volume surged to 3,000 lots but traders said it was unclear if the recovery would be sustained after the incentives ended. ICE Middle East Tuesday traded just 20 lots.

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