The New York Mercantile Exchange is set to launch a Northwest Europe gasoil futures contract for open outcry trading in Dublin this Friday.

The contract will be listed for 18 months, starting with the May 2005 contract.

In February and just three months after trading in crude oil futures got underway in Dublin, the open outcry trading ring in the IFSC announced it was closing.

NYMEX closed the Dublin trading floor after it failed to live up to expectations. It then set up a trading floor in London.

It had launched the Brent crude oil futures contract in Dublin last November, just as its London-based rival, the International Petroleum Exchange, closed its Brent trading ring during morning hours.

The IPE move, part of a shift towards electronic trading, proved unpopular with many London traders. They preferred the open outcry trading method, which requires buyers and sellers - gathered in a central location - to cry out bids and offers to each other.

But although the exchange offered attractive incentives to traders to encourage them to move to Dublin to trade, most wanted NYMEX to locate in their home base of London.

Despite a promising start, volumes in Dublin failed to live up to expectations and slowed to a trickle since Christmas. NYMEX had initially targeted volumes of around 10,000 contracts a day, but the daily average over the last three months had been just under 3,000.

'We realise the importance of the gasoil futures market to the European trading community, and we are pleased to offer the contract in Dublin,' commented Exchange President James E Newsome.