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In the past, Platts has tended to track broader freight trends over
time to establish FOB/CIF relationships. Platts now actively
assesses those relationships on a daily basis, and actively uses
freight information published by Platts in the assessment of
product values. Platts tanker publications Platts Clean
Tankerwire and Platts Dirty Tankerwire now carry both
worldscale and $/mt freight assessments for clean products and
fuel oil, which may be incorporated in assessments where
appropriate.
METHODOLOGY GUIDE GENERAL TERMS AND CONDITIONS
SHIPPING
Platts typically reflects good quality modern tonnage in its
freight assessments, and excludes from its CIF assessments any
vessels which are outside the normal parameters of acceptability.
Platts may take into account a variety of factors when
establishing whether it will include bids or offers with specific
shipping requirements or conditions in its assessments, such as
the vessel’s age and chartering history.
Platts considers in its CIF cargo assessments offers where the
seller a) names the ship carrying the oil product, b) seller
commits to meet ‘normal’ requirement by buyer, c) seller
commits to have ship approved by at least three named majors
which need to be stated, d) or commits to ship which will be
approved by major selling, major buying, and second major
named by buyer.
SWAPS
Bids and offers for Over the Counter derivative instruments
such as swaps (also know as Contracts for Differences or CFDs)
are subject to the same incrementability and repeatability
standards applicable to the physical markets. Bids/offers
should move up or down in increments not exceeding $1/mt.
Bids or offers submitted on a firm basis should be open for
execution to the first reputable and creditworthy party of
record. Bids and offers for paper instruments should be
submitted no later than 16.15:00 London time. Changes to the
bids and offers will be recognized up to 16.28:00 London time.
Firm bids and offers automatically expire at 16.30:00 London
time. Please note that the purpose of these time cut-offs and
standards of incrementability and repeatability are primarily
logistical, and designed to ensure orderly price discovery. As
such, they may be changed at short notice if evolving market
conditions require.
SEASONALITY
The switch in gasoline and diesel qualities from summer to
winter grade and vice versa may have a significant impact on
gasoline prices in Europe.
EUROPEAN PRODUCTS
Platts generally announces a phase-in period for the summer
and winter grades on cargoes and barges, in which the
incoming seasonal grade is given an increasing weighting in the
assessment.
For example, on gasoline, from April 1 2006, European
gasoline markets traded summer grades of fuel. Platts reflected
cargoes loading and discharging 10-25 days forward and
barges loading 3-15 days forward. On March 7, the first day of
the cargo window to pass April 1, Platts reflected 1 day of
summer grade gasoline and 14 days of winter grade, with
summer gaining increasing weighting in the assessment as
each day passed. On March 22, as the last day of the cargo
window passed April 1, only summer grades of fuel were
reflected in the cargo assessment. The same weighting
approach is applied to reflecting summer grades of gasoline in
the barge market.
Each year, Platts publishes details of the timetable for including
seasonal specifications in subscriber notes, an example of which
is provided below:
GASOLINE AND DIESEL SUBSCRIBER NOTE: Platts proposes
effective March 7 to start reflecting summer grades of gasoline
and diesel on a pro-rated basis in the Northwest European and
Mediterranean cargo assessments, with summer spec having an
increasing weighting in the assessment towards March 22.
Winter grades will continue to be taken into account until
March 21, after which only summer spec will be reflected.
Platts proposes effective March 17 to start reflecting summer
grades of gasoline and diesel on a pro-rated basis in the ARA
barge market, with summer spec having an increasing weighting
until March 28. From March 29 summer will be fully reflected.
For further details regarding the pro-rating system or any
comments regarding the proposal please contact
annalisa_jeffries@platts.com, simon_thorne@platts.com with a
cc to peter_stewart@platts.com and
jorge_montepeque@platts.com.
Because Platts aims to synchronise the transition in seasonal
qualities in its assessments with market practice, Platts may
revise these timeframes at short notice if market practice changes
in this regard.
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DATA CODES
Each Platts assessment is identified in the electronic databases by a
7-character data code. The following table provides the data codes
for European oil product assessment carried in Platts European
Marketscan. The table layout is based on the telex/newsletter version
of Platts European Marketscan; when assessments are carried in
related publications such as Platts Oilgram price Report or the
regional marketscans, the actual layout may vary.