Platts calculates WTI Midland Freight Adjustment Factor in Dated Brent as a volume-weighted average

Platts, part of S&P Global Commodity Insights, calculates the WTI Midland Freight Adjustment Factor (FAF), reflected in Dated Brent, as a weighted average based on relative 2022 production of Brent, Forties, Oseberg, Ekofisk and Troll.

This change is effective May 2, 2023, when WTI Midland is included in the FOB (Free On Board) Dated Brent benchmark.

This follows a proposal note published Feb. 24, a decision note published March 28 and a clarification note published April 20:

https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/022423-platts-proposes-to-calculate-wti-midland-freight-adjustment-factor-in-dated-brent-as-a-volume-weighted-average

https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/032823-platts-to-calculate-wti-midland-freight-adjustment-factor-in-dated-brent-as-a-volume-weighted-average

https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/042023-platts-clarifies-wti-midland-freight-adjustment-factor

Platts publishes the WTI Midland Freight Adjustment Factor for use in Dated Brent to the code FSFRM00. The name of the assessment will be "North Sea-Rotterdam" from May 2, 2023.

The FAF is published at 11 am London time ahead of the Platts Market on Close assessment process to pages PGA and PCR 1218. It is also published in Crude Oil Marketwire.

Platts will use a weighted average of the Brent, Forties, Oseberg, Ekofisk and Troll flat rates from their respective terminals to Rotterdam, to calculate the WTI Midland Freight Adjustment Factor.

The weightings will be:

Sullom Voe: 6%

Hound Point: 34%

Sture: 10%

Teesside: 31%

Mongstad: 19%

Based on these weightings and using the revised 2023 flat rates, the average flat rate used in the WTI Midland Freight Adjustment Factor calculation will be $6.93/mt. Please note this is different to the flat rates published in the proposal and decision notes due to recent updates to the Worldscale flat rates.

The 10-day rolling average of the Platts Dirty Cross-UK/Continent 80,000 mt Worldscale freight assessment [TDUUW00] and the Rotterdam port fee will be applied to the average flat rate of $6.93/mt and multiplied by 80%.

The Rotterdam port fee is typically updated annually and published by Platts in a subscriber note on the first working day of each calendar year.

Going forward, Platts will review the weighting percentages should significant and persistent instances of production volume changes occur.

Please send all feedback and questions to europe_crude@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 feedback not marked as confidential available to the public upon request.