Final preparations are underway at the Shanghai International Energy Exchange, or INE, in the city's pilot free trade zone. After five system tests in 2017, the trading platform has had small glitches but is nearly set to go, according to Tang Yun, an assistant to the president of Shanghai-based East Asia Futures. Trading in yuan could start by March, once the authorities give the go-ahead.

While China mostly prohibits foreign investors from trading commodity futures on its soil -- to prevent a flood of speculative funds -- it is opening its doors wide for crude. Jiang Yang, vice chairman of the China Securities Regulatory Commission, on Jan. 15 said China will welcome domestic and overseas investors alike.

Simply put, the government is determined to turn the INE's crude oil futures into a global benchmark, and to do so it needs to get large numbers of traders involved. The more participants a market attracts, the more liquid it will be, and the more it will inspire confidence.

This is not China's first attempt at handling oil futures. It launched trading in 1993, only to shut down the operation about one and a half years later due to volatility and other issues.

Now China is calling on oil producers and consumers -- from global majors to its own big players -- to participate in the new market. The INE plans to handle seven kinds of Middle Eastern crude, including Basrah Light produced in Iraq, Dubai crude and Oman crude. China Petroleum & Chemical, or Sinopec, and other state-owned Chinese companies that import large volumes from the Middle East are expected to make use of the market.

So are small and midsize refineries. The government has been working to liberalize the business and in 2015 started assigning oil import quotas to "teapots" -- small, independent refineries. The teapots see the INE as a place to hedge the risk of price swings on Middle Eastern imports.

What China is doing here is challenging the U.S.-led world order, established in the wake of World War II.

Although oil demand has shifted toward Asia, the world's leading benchmarks are still West Texas Intermediate in the U.S. and Brent crude in London. Their position reflects market liquidity and transparency.

Dubai crude, a benchmark for Asia, is mainly traded on a spot basis, while futures trading in Tokyo and elsewhere is sluggish. In reality, Dubai crude prices are influenced by Brent futures.