Platts to amend Middle East crude cargo size

Following extensive feedback from interested parties, Platts is considering amending the full cargo size reflected in its Dubai, Oman and Upper Zakum crude oil spot price assessment process to 500,000 barrels.

The proposed change reflects the evolution in volume standards for Middle East crude oil loadings of 500,000 barrels, where deliveries now typically occur with a minor operational tolerance of 1,000 barrels rather than a traditional 5% or 25,000 barrels.

Currently, the cargo size of Dubai, Oman or Upper Zakum used in Platts assessment process is typically 475,000 barrels.

Partial cargoes, trading in lots of 25,000 barrels each, converge into a full physical cargo when a 19th partial is traded between a single buyer and a single seller, resulting in a 475,000-barrel cargo -- equivalent to a full 500,000-barrel cargo with an implied operational tolerance of minus 5%.

Under the proposed revision, Platts is considering adapting this mechanism for convergence upon 20 partials, into a 500,000-barrel cargo. In each case, operational tolerance is defined under Platts methodology as 1,000 barrels.

Platts is considering an implementation date of January 3, 2011, for this methodology revision, but will collect market feedback on whether an earlier date is preferred.

Platts' current crude methodology is published here: http://platts.com/IM.Platts.Content/MethodologyReferences/MethodologySpecs/cr udeoilspecs.pdf or http://bit.ly/crudespecs.

Please provide comments & queries by August 1, 2010, to asia_crude@platts.com and pricegroup@platts.com.