Platts clarifies freight compensation for European LPG FOB cargo MOC

Platts, part of S&P Global Commodity Insights, clarifies that freight compensation for deals done in the European Propane and Butane FOB cargo Market on Close (MOC) assessment process should be commensurate with the demonstrable incremental freight cost to the disport from the specified port and actual load port based on prevailing market freight rates on a pressurized vessel. Freight compensation should not be based on commercial considerations.

In line with existing methodology, a buyer must be prepared to load from any reasonable load port within the geographical region specified in the assessment methodology. For example, a seller hitting a bid basis a specified port in the MOC may elect to change the load port. In addition, in the event of a buyer lifting an offer basis a specified port in the MOC, the seller may still nominate a different load port, subject to potential freight compensation.

The above clarification applies to the following assessments and MOC processes:

Platts always expects demonstrable and reasonable efforts to be made to perform a trade reported in its Market on Close assessment processes.

Please send any comments to europe_products@spglobal.com with a CC to 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.