Platts proposes to change flat rate basket for 140kt Black Sea-Med, 100kt Baltic-Med tanker assessments; calculate 100 kt Baltic-UKC assessment from Dec. 1

Platts, part of S&P Global Commodity Insights, proposes to change the basket of ports used in the dollar per metric ton calculations for its 140kt Black Sea-Mediterranean and 100kt Baltic-Mediterranean dirty tanker assessments, effective Dec.1, 2022, in light of European Union sanctions on Russian crude and fuel oil imports.

In addition, Platts is proposing to publish its 100 kt Baltic-UKC dirty tanker assessment as a fixed differential to its 80 kt UKC-UKC dirty tanker assessment, effective Dec. 1, 2022, as the underlying flow of Russian crude and fuel oil into Europe ceases due to sanctions.

According to the EU's fifth sanctions package, imports of some Russian products into the EU, including high sulfur fuel oil, have already been banned since Aug. 10, 2022. In addition, the EU has also imposed a complete import ban on all seaborne Russian crude oil to the bloc from Dec. 5, 2022.

CHANGE IN FLAT RATE BASKETS: As a result, Platts is proposing to change the discharge ports used in its 140kt Black Sea-Med and 100kt Baltic-Med dirty tanker flat rate baskets to non-EU disports, from Dec. 1, to reflect changing trade flows.

In markets where freight is traded on a Worldscale basis, Platts publishes freight assessments in points, which reflect a percentage of the prevailing Worldscale annual flat rates. Platts also publishes equivalent $/mt freight rates for these markets, based on a basket of Worldscale flat rates comprising several key routes between the two regions specified in the assessment.

Since Russia's invasion of Ukraine on Feb. 24, 2022, 75% of total Suezmax shipments out of Novorossiysk, Russia to non-EU ports discharged at Turkish ports, while 25% discharged at Israeli ports, according to ship-tracking data available to Platts. Of the shipments that headed to Turkey, 70% discharged at Aliaga, while 26% discharged at Yarimca Izmit. Of Israeli disports, the port of Ashkelon accounted for 60% of shipments.

Meanwhile, since the invasion, 97% of total Aframax shipments from Russia to non-EU ports, discharged at Turkey. Of the Turkish shipments, Aliaga accounted for 67% while Yarimca Izmit accounted for 33%.

FIXED CALCULATION FOR 100 KT BALTIC-UKC ASSESSMENT: As a result of EU sanctions on Russian crude and fuel oil imports into the region, Platts is also proposing to publish its 100 kt Baltic-UKC dirty tanker assessment as a fixed premium of 25 points to its 80 kt UKC-UKC dirty tanker assessment, effective Dec. 1, 2022.

Following Russia's invasion of Ukraine, the 100 kt Baltic-UKC route has typically been assessed at a premium to the 80 kt UKC-UKC route, as fewer shipowners have become willing to call at Russian ports.

After the EU adopted its sixth package of sanctions against Russian oil on Jun. 3, 2022, the 100 kt Baltic-UKC route has been assessed at an average premium of 25 points to the 80 kt UKC-UKC route, according to Platts data from Jun. 6-Oct 19, 2022.

Prior to Russia's invasion of Ukraine on Feb. 24, the 100 kt Baltic-UKC route was assessed at an average discount of 21 Worldscale points to the 80 kt UKC-UKC route, according to Platts data from Jan 4, 2016 to Feb. 23, 2022.

The flat rate basket used in the dollar per mt calculation for the 100 kt Baltic-UKC assessment will remain unchanged as the following:

100kt Baltic-UKC flat rate basket:

Primorsk-Rotterdam

Primorsk-Le Harve

Ust Luga-Rotterdam

The proposed changes will affect the following assessments:

Assessment name Daily Code MAvg Code

Black Sea-Mediterranean 140kt $/mt TDAFI00 TDAFI03

Baltic-Mediterranean 100kt $/mt DBLMA00 DBLMA03

Baltic-UKC 100 kt Wsc TDADP00 TDADP03

The affected assessments and related monthly average assessments are published in Dirty Tankerwire and Dirty Tankerwire Monthly; on Platts Shipping Alert pages 1440,1441,1430, 1431 and Platts Tanker Alert pages 1960,1961,1970,1971; as well as in the Platts price database under the codes above.

Please send any feedback, questions or comments by Nov. 3, 2022 to shipping@spglobal.com and pricegroup@spglobal.com.

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