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Caught short

Given the difficulty China Aviation Oil is having closing its remaining illiquid positions, its derivative trading losses may be greater than first thought. James Ockenden and Stella Farrington report

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China Aviation Oil (Singapore) Company (CAOSCO) began 2004 with an award for its risk management capabilities and a bright future as the trading arm of a near-monopoly supplier of jet fuel into China’s booming aviation market.

But it ended the year in bankruptcy, with its chief executive Chen Jiulin on bail from a Singapore jail, and with Singapore becoming the centre of a scandal surrounding the

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