Platts to change basis for Latin American crude assessments

Platts is proposing several improvements to its Latin American crude oil assessment methodology, aimed at providing additional price transparency and addressing the growing use of Brent as a pricing basis for Latin American crude export sales. Platts is proposing to implement these improvements on January 1, 2013.

First, Platts proposes to move the timing forward for its Latin American crude assessments to reflect bids, offers, and deals 30-60 days from date of publication. Currently, Platts Latin American crude assessments reflect crude loading 15-45 days forward from date of publication. This move would reflect a trend in the market toward trading Latin American crudes further forward in time.

Second, Platts proposed to shift the basis for its Latin American assessments from second month WTI to the average of the prevailing front month contract at the time of loading. For example, on June 1, the basis for Platts Latin American crude assessments would be August WTI. Under this proposal, the basis for Platts Latin American crude assessments on June 1 would reflect the average of prevailing front month WTI for July 1-31 -- August WTI for July 1-25, and September WTI for July 26-31. Platts would publish this Latin American WTI strip on a daily basis.

In addition, Platts proposes to launch Brent-related differentials for all Latin American crudes assessed by Platts and a Latin American Brent strip, reflective of the prevailing front month Brent value for 30-60 days forward from date of publication. These Brent-related differentials and the strip would run along side the existing WTI-based outright price and differential assessments for Latin American grades.

These two new strip assessments for WTI and Brent and the Brent-related differentials will appear on Platts Global Alert page 280, in Platts Market Data, Crude Oil Marketwire, Oilgram Price Report and in Platts Latin American Wire.

Please send questions or comments by August 31, 2012, to americas_crude@platts.com and pricegroup@platts.com.