SUBSCRIBER NOTE: Platts to amend Asia bunker assessment methodology

S&P Global Platts will amend the delivery period and volume reflected in its assessment of delivered bunker prices at various Asian and Middle Eastern ports from June 3, 2019.

The changes follow extensive consultation with the industry after Platts made similar changes to its Singapore delivered bunker methodology on July 2, 2018: https://www.spglobal.com/platts/en/our-methodology/subscriber-notes/070218-pl atts-amends-laycan-in-singapore-delivered-bunker-assessments

Platts first proposed the changes in a subscriber note published March 21, 2019: https://www.spglobal.com/platts/en/our-methodology/subscriber-notes/032119-pl atts-proposes-to-amend-asia-bunker-assessment-methodology

The changes will align bunker price assessments across Asian and Middle East ports to the regional bunkering hub of Singapore and ensure trading activity reflected in Platts assessments continues to reflect typical market trading cycles and standard practices.

ASSESSMENT LAYCAN: Platts will amend the delivery period reflected in its delivered bunker assessments to 5-10 days from the date of publication from the current 3-7 days.

The change in delivery periods will be applicable to delivered bunker assessments for 380 CST, 180 CST, marine gasoil and low sulfur marine gasoil at Fujairah, Hong Kong, Shanghai and South Korea (Busan and Ulsan), and delivered 380 CST, 180 CST, marine diesel oil and low sulfur marine diesel oil at Japan (Tokyo/Yokohama Bay) and West Japan (Setouchi).

Following the change, buyers/sellers participating in the Platts Market on Close assessment process for delivered bunkers will be required to specify three consecutive days for delivery within the assessment laycan of 5-10 days from the date of publication.

For example, on July 2, Platts will publish interest from buyers and sellers for bunker deliveries on July 7-9, July 8-10, July 9-11 and July 10-12.

ASSESSMENT VOLUME: Platts will also change the volume reflected in its delivered bunker assessments to between 500 mt and 1,500 mt. Currently the minimum size parcel assessed is 500 mt for 180 CST and 380 CST bunker fuel, except in Japan, South Korea, Hong Kong and Shanghai where a minimum quantity of 300 mt is assessed (500 mt for 380 CST in Hong Kong and Shanghai), while the maximum quantity is 1,500 mt, except in Japan, South Korea and Shanghai where it is 2,500 mt.

The parcel size reflected in the assessment of marine gasoil, low sulfur marine gasoil, marine diesel oil and low sulfur marine diesel oil will be 50 mt and above.

In addition, Platts will publish bids and offers for volumes in a 100 mt range for parcels under 1,000 mt, and in a 200 mt range for parcels above 1,000 mt. Buyers must declare the exact volume to the seller within one working day after the trade has been concluded.

Buyers and sellers may submit bids and offers for the following volume range: 500-600 mt, 600-700 mt, 700-800 mt, 800-900 mt, 900-1,000 mt, 1,000-1,200 mt, 1,100-1,300 mt, 1,200-1,400 mt and 1,300-1,500 mt.

Buyers must provide to the seller a written notice of arrival of the vessel at the place of delivery at least 48 hours prior to the day of delivery. Sellers are expected to deliver bunker fuel that is merchantable, within port limits to the buyer's nominated vessel in a timely manner.

Prices assessed will continue to reflect activity reported to Platts throughout the day, and values for all reported trades normalized to reflect the prevailing value of the market at 5:30 pm in Singapore.

The codes of Asian and Middle Eastern Bunker Assessments' methodology, which will be amended, are as follows:

380 CST bunker delivered Japan PUAEV00 West Japan AARJZ00 South Korea PUAFR00 Busan PUAGQ00 Hong Kong PUAER00 Shanghai AARKD00 Fujairah PUAXP00 Kuwait PUAEY00 Khor Fakkan PUAEX00

180 CST bunker delivered Japan PUACK00 West Japan AARJY00 South Korea PUADT00 Busan PUAGP00 Hong Kong PUACC00 Shanghai AARKC00 Fujairah PUAXQ00 Kuwait PUACP00 Khor Fakkan PUACO00

Marine gasoil 1.5% delivered South Korea AAVBN00 Busan AARKJ00 Shanghai AARKE00 Fujairah AARKH00 Kuwait AAXCV00 Khor Fakkan AARKI00

Marine gasoil 0.1% delivered Singapore AAXYO00 Hong Kong AAXYQ00 South Korea AAXYS00 Shanghai AAXYR00 Fujairah AAXYP00

Marine diesel 2% delivered Japan POACI00 West Japan AARKA00

Marine diesel 0.1% delivered Japan AAXYT00 West Japan AAXYU00

Please send all questions and comments to asia_products@spglobal.com and pricegroup@spglobal.com.

For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing.

Platts will consider all comments received and will make comments not marked as confidential available upon request.