SUBSCRIBER NOTE: Platts to update timings on Singapore HSFO paper MOC increments

S&P Global Platts is to change the increments for the Market on Close assessment process for Singapore high sulfur fuel oil derivatives to a minimum incrementability of 5 cents/mt for every 10 seconds and maximum of 50 cents/mt for every 10 seconds, for flat price bids and offers from July 7, 2017.

Platts initially proposed this change in a note published on January 5, 2017, and it subsequently extended the feedback period around this proposal until April 28, 2017.

The current incrementability for flat price bids or offers for HSFO derivatives are set at a minimum of 25 cents/mt per 30 seconds and a maximum of 100 cents/mt per 30 seconds.

Platts will also change the increment for the MOC assessment process for Singapore HSFO derivatives to a minimum incrementability of 5 cents/mt for every 10 seconds and a maximum of 25 cents/mt for every 10 seconds for timespread and viscosity spread bids and offers.

The current incrementability for timespread and viscosity spread bids or offers for HSFO derivatives are set at a minimum of 25 cents/mt per 30 seconds and a maximum of 50 cents/mt per 30 seconds.

Platts has noted that typical price movements in the fuel oil derivative MOC process have become more granular over time as market liquidity has increased. Price changes in excess of 50 cents/mt do not test repeatable values at narrower increments that are fully tradable.

Concurrently, the speed of trade in the fuel oil derivative process regularly demonstrates the capacity for value to be tested in 10-second periods.

Platts typically assesses fuel oil derivative contracts to the nearest 5 cents/mt. A move to reflect this smaller increment would allow market participants to demonstrate value to the same level of granularity.

The extension trigger timing will remain unchanged. An extension would be triggered by any price move or a re-bid/re-offer in the last 10 seconds prior to the close of the MOC at 16:30:00 Singapore time.

Please send any feedback or questions 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.