Russia's Prime Minister Vladimir Putin (R) visits the Novokuibyshevsk oil refinery near the city of Samara, Russia. Reuters/RIA Novosti Russia is hoping to launch a futures market for its oil benchmark, the Urals blend.

According to a Reuters report, Russia has for years wanted to establish a rival oil futures market to the Brent benchmark, but Russian President Vladimir Putin is seeking to finally turn it into a reality. The motivation stems from the fact that Russia is forced to sell its oil at a discount to the widely traded Brent benchmark based in the North Sea.

The discount for the Urals blend has averaged $0.84 per barrel in 2015, and $0.99 per barrel last year. But that is sharply down from the discount ten years ago, which often widened to as much as $5 to $6 per barrel. Nevertheless, the discount has started to grow again in recent weeks.

Despite previous attempts to launch a futures contract for Urals, it has never gotten off the ground. Russia proposed a futures market that would trade on the New York Mercantile Exchange in 2007, but the attempt failed.

This time around, Russia is determined to make a futures market a reality due to the low prices for crude, generally, and the deeper discount for Urals below Brent. To make matters worse, Saudi Arabia has encroached on Russia’s market in Europe, discounting its oil to seize market share away from Russia. That has created pressure for a larger discount for Urals as Russia tries to hold onto its traditional market.

Moreover, Iran is just months – if not weeks – away from bringing upwards of 500,000 barrels per day of capacity back to the market. Iran had a sizeable portion of the European market before sanctions pushed it out in 2012. Iran is looking torecapture some of its lost customer base, which threatens the Urals blend with even more competition.

An Urals futures market still faces the same hurdles as before, however. Without enough liquidity in the physical market, traders are unlikely to support the new benchmark. It is unclear how and where these physical deliveries can take place. Without that physical market, the futures market is hard to support. Plus, Urals tends to come in lower quality compared to Brent oil.

Russia launched a “simulator” trade for Urals futures on the St. Petersburg International Mercantile Exchange (SPIMEX) in November, which offers spot trading for refined fuels but not crude.