Platts proposes to publish independent FOB Fujairah 500 ppm sulfur gasoil outright assessment

Platts, part of S&P Global Commodity Insights, is proposing to launch an independent outright price assessment for 500 ppm sulfur gasoil in the Middle East market, effective Nov. 1, 2022.

The proposed spot price assessment will be described as "FOB Fujairah" in Platts publications and databases, and run alongside Platts' existing MOPAG 500 ppm sulfur gasoil physical netback value. The new assessment will reflect spot cargoes loading on an FOB basis at ports across the Persian 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 this assessment.

Platts already publishes physical differential assessments for FOB AG 500 ppm gasoil, which will be used to assess the new outright value, alongside any bids, offers or trades on an outright basis in the Platts Market on Close assessment process. The proposed new daily outright assessment for 500 pm sulfur gasoil will reflect the value of cargoes with a minimum size of 200,000 barrels and maximum size of 300,000 barrels, loading 20-40 days forward. Platts will also publish a monthly average for the assessment.

OUTRIGHT VALUE: The proposed independent outright assessment for 500 ppm sulfur gasoil will 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 Gasoil derivative assessments are based on bids, offers and trades seen in the Platts MOC process as well as other observed spot market activity. Platts will 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 will take into consideration the Singapore derivatives for gasoil, coupled with relevant freight netback and forward freight agreement values.

The new FOB Fujairah 500 ppm sulfur gasoil outright assessment will reflect the following specifications:

LOADING PORTS: Cargoes loading from the following Gulf ports will 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 will 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 MOC 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 assessment will reflect the tradable value at 12:30 pm Dubai time. This timestamp aligns with the respective netback values that Platts already publishes in the Middle East, corresponding to the 4:30 pm Market on Close in Singapore.

Please send any feedback, comments and queries to asia_products@spglobal.com and pricegroup@spglobal.com by Sept. 30, 2022.

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.