SUBSCRIBER NOTE: Platts to add Chicago Buckeye Complex gasoline, ULSD assessments

S&P Global Platts will launch new assessments, with effect from July 2, 2018, for CBOB and RBOB gasoline and ULSD based on the Buckeye Complex storage hub in the Chicago area.

BACKGROUND: The launch of the new assessments follows a formal review of Chicago assessment methodology announced in a subscriber note February 8, 2018, which showed widespread interest in price assessments based on market activity at the Buckeye Complex, also known as BCX.

Platts current Chicago assessment methodology is based on a generic Chicago basis, as opposed to any specific pipeline. Under current methodology, bids, offers or trades for product delivered into Chicago for a specific pipeline are normalized back to the generic Chicago basis for assessment purposes.

REVIEW FEEDBACK: Feedback gathered during the review confirmed that the majority of observed Chicago market activity is based on a specific, rather than generic, basis. In addition to the pipelines named in the existing Platts methodology, the Buckeye Complex storage hub is increasingly used as the basis for many gasoline and diesel trades.

Based on industry feedback, Platts has now decided to add assessments for Gasoline CBOB Chicago Buckeye Complex, Gasoline RBOB Chicago Buckeye Complex and ULSD Chicago Buckeye Complex. Bids, offers and trades for other pipelines or terminals may be normalized back to the Buckeye Complex basis for assessment purposes.

UPDATE TO EXISTING METHODOLOGY: Platts has also decided to clarify the methodology of its existing Chicago gasoline, diesel and jet fuel assessments so that they reflect the lowest value of the Badger, West Shore and Wolverine pipelines. This change is addressed in a separate subscriber note. Platts will not be changing any of the current Chicago assessment names.

Platts will maintain all other aspects of Chicago methodology and apply them to the new Buckeye Complex assessments, including timing, tied to three Explorer Pipeline cycles rolling to a new month on the 25th of each month, then rolling on the 5th and 15th for the second and third cycles.

Please send any feedback to americas_products@spglobal.com and pricemethodology@spglobal.com. 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.