Platts proposes independent Middle East naphtha, 92 RON gasoline assessments

S&P Global Platts proposes to launch independent price assessments for naphtha and 92 RON gasoline in the Middle East market, effective September 1, 2020.

These new spot price assessments would be named "FOB Fujairah" in Platts publications and databases, and run alongside Platts' existing MOPAG netbacks.

The new assessments would be published alongside Platts existing physical netback values for these products. They reflect spot cargoes loading on an FOB basis at ports across the Gulf.

The Middle East has seen substantial growth in refining and storage capacity over the past decade, as well as widespread growth in physical oil trading and market participation. These factors have led to a more vibrant and active spot physical market for oil products, which will be the basis for these assessments.

Platts already publishes physical differential assessments for FOB AG naphtha and 92 RON gasoline, which would be used to assess the outright values alongside any bids, offers or trades on an outright basis.

NAPHTHA: Platts would publish six new daily assessment values and two new monthly averages for naphtha. The six new daily assessments would comprise a cash assessment for cargoes with a minimum size of 25,000 mt and maximum size of 75,000 mt loading 20-40 days forward; three monthly derivatives assessments including balance month and two forward months; a naphtha MOPAG strip value and a balance month Japan derivative assessment. Platts would also publish a monthly average for the cash assessment and the naphtha MOPAG strip.

The independent Middle East naphtha cash assessment and differential would reflect the following specifications:

FOB AG NAPHTHA SPECIFICATIONS

Property Standard

Color saybolt Min +20

Density at 15 deg C kg/l Min 0.66, Max 0.73

Distillation

10% vol recovered deg C Report

50% vol recovered deg C Min 50, Max 110

90% vol recovered deg C Min 75, Max 150

End point deg C Max 170

Lead content, ppb/wt Max 50

PONA

Aromatics, vol% Max 15

Naphthenes, vol% Report

Olefins, vol% Max 1

Paraffins, vol% Min 70

N-paraffins, vol% Report

Reid Vapor Pressure at 37.8 deg C Max 13 psi

Sulfur, Total, ppm/wt Max 400

Mercury, ppb Max 1

Oxygenates, ppm Max 50 ppm TAME, MTBE and/or ETBE

GASOLINE: Platts would publish five new daily assessment values and two new monthly averages for 92 RON gasoline. The five new daily assessments would include a cash assessment for cargoes with a minimum size of 200,000 barrels and maximum size of 300,000 barrels loading 20-40 days forward; three monthly derivatives assessments including balance month and two forward months; and a 92 RON MOPAG strip value. Platts would also publish a monthly average for the cash assessment and the 92 RON gasoline MOPAG strip.

The outright 92 RON gasoline value would reflect the same specifications as the existing differential assessment:

Property Standard

Research Octane Number Min 92, Min 95

Motor Octane Number Min 82, Min 85

Appearance Clear

Color Undyed

Corrosion, Copper Strip (3 Hrs at 50°C) Max 1

Density at 15°C kg/cu m 0.72-0.78

Distillation

10% vol recovered at (°C) Max 65

50% vol recovered at (°C) Min 80, Max 120

90% vol recovered at (°C) Max 180

End point (°C) Max 210

Residue, vol% Max 2

Doctor Test Negative

Gum, Existent (mg/100 ml) Max 4

Induction Period (minutes) Min 480

Lead Content, gPb/l Max 0.013

Reid Vapor Pressure at 37.8°C (psi) Max 9

Sulfur, wt % Max 0.01

Allowed oxygenates/MTBE (If added) Max 15 (of which maximum MTBE content of 10.0)

Alcohol No additions of any alcohol

Aromatics, vol % Max 35

Benzene, vol % Max 1

Olefins, vol % Max 18

Odor Marketable

Additives No metal additives; no metal octane boosters

The new 92 RON gasoline assessment would be published alongside the current FOB Fujairah 95 RON gasoline assessment that was launched on October 3, 2016.

OUTRIGHT VALUE: The independent outright assessments for both naphtha and 92 RON gasoline would reflect the existing spot differential (premium/discount) assessment of the product plus the associated MOPAG strip value. The strip reflects the average of daily swap values over a 21-day period between 20-40 days from the day of publication.

The MOPAG derivatives assessments and values would be based on trades seen in the Platts Market on Close assessment process or on derivatives exchanges or heard in over-the-counter markets. Platts would also take into consideration physical bids, offers and trades on an FOB Arab Gulf basis in the MOC process. In the absence of any bids, offers or trades, Platts would take into consideration the Japan derivatives for naphtha and the Singapore derivatives for gasoline, coupled with freight netback and forward freight agreement values.

LOADING PORTS: Cargoes loading from the following Gulf ports would be considered for inclusion in the assessments: Jubail, Jebel Ali, Mina Al Ahmadi, Shuaiba, Ras Tanura, Ruwais, Mina Abdulla, Sohar, Sitra, Fujairah, Ras Laffan and any safe and sound port within this geographic area.

Platts would only publish offers where sellers specify at least one and no more than three representative load points and would only publish bids where buyers specify at least three representative load points.

For all trades reported through the Platts Market on Close process for the above assessments, the seller would declare the terminal 12 days prior to loading. The buyer would nominate the vessel seven days prior to loading and narrow the loading window to three days, subject to terminal acceptance.

TIMESTAMP: The price assessments would reflect the tradable value of these markets at 12:30 pm Dubai time. This timestamp would align the new assessments with the respective netback values that Platts already publishes in the Middle East, corresponding to the 4:30 pm Market on Close in Singapore.

FEEDBACK: Please send all comments and queries by July 31, 2020 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.