SUBSCRIBER NOTE: Platts begins assessing CIF NWE LSFO as freight forward

Following industry feedback and a detailed review of the low sulfur market in Europe, Platts is amending the methodology for assessing CIF Northwest Europe 1% sulfur fuel oil cargoes to reflect a freight forward calculation only.

With effect from October 3, 2016, Platts is assessing the value of CIF Northwest Europe 1% sulfur fuel oil cargoes by adding the daily Baltic-UKC dirty handysize freight rate as published in $/mt in Platts Dirty Tankerwire to Platts FOB Northwest Europe 1% sulfur fuel oil cargo assessment. CIF NWE LSFO cargo bids and offers will no longer be accepted in the MOC process.

This change follows a proposal note requesting feedback, published June 15, 2016, and a decision note published August 25. Both can be viewed at the following location: http://www.platts.com/subscriber-notes

The methodology change follows the decline of LSFO bunker demand in Northwest Europe after the lowering of the sulfur cap in Emission Control Area zones to 0.1% from January 1, 2015 (from 1% previously), and the long-term decline in fuel oil use for power generation in Europe. These factors have greatly reduced the number of consumers of LSFO cargoes in the region, and reduced the size of the delivered, CIF market.

Platts invites feedback on this methodology change. Please send any comments and queries to europe_products@spglobal.com, CC'ing 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.