Platts proposes changes in Asia MTBE assessment methodology

Following consultation with the market, Platts, part of S&P Global Commodity Insights, is proposing changes to its FOB Singapore MTBE assessment, effective Jan. 2, 2025.

Differential assessment to 92 RON gasoline derivatives: Because MTBE cargoes trade both on an outright price and a floating price basis to the Platts FOB Singapore 92 RON gasoline derivatives, Platts proposes to assess an MTBE differential for cargoes loading 15-40 days forward from the date of publication to the Platts FOB Singapore 92 RON gasoline Mean of Platts Singapore (MOPS) Strip at 4:30 pm Singapore time.

This differential, expressed in $/b, would represent a premium or discount relative to the Platts FOB Singapore 92 RON gasoline prices.

The 15-40 days forward gasoline MOPS Strip would be used as a basis to measure the value of the physical MTBE market when a floating price is used. Platts would use Balance Month and Month 1 gasoline derivatives assessments to calculate the MOPS Strip value until the 15th calendar day of the month, following which Month 1 and Month 2 derivatives assessments would be used to calculate the strip.

Platts would publish the MTBE differential in $/b, in addition to the existing outright price assessment in $/mt. Platts understands that the standard MTBE conversion for $/mt to $/b is 8.45.

Cargo size: Platts proposes to reflect a cargo size of 5,000 mt in the FOB Straits MTBE assessments, in addition to its existing 3,000 mt. This proposed change aligns with the growing preference for larger cargo sizes in response to freight efficiency and changing trading patterns in the region.

As part of this change, Platts would discontinue the inclusion of 2,000 mt parcels in the assessment methodology.

In cases where the bid and offer might cross due to volume differences, the largest volume within the published guidelines would take precedence in the assessment process. For example, a bid for 5,000 mt of MTBE on a FOB Singapore basis would take priority over an offer of 3,000 mt, in cases where the bid and offer might cross due to volume differences.

Laycan: Platts proposes to maintain the current MTBE loading window, which is currently assessed for loading on FOB Singapore basis 15-40 days forward from the date of publication.

E-window: As part of the methodology change, Platts would add new instruments on the Platts Editorial Window, or eWindow, for the FOB Straits MTBE Market on Close assessment process. The new instruments would allow market participants to submit bids and offers for FOB Straits MTBE as differentials expressed in $/b over Platts FOB Singapore 92 RON gasoline MOPS Strip.

Market participants would be able to improve their bids and offers by a minimum of $0.01/b per 30 seconds and a maximum of $0.05/b per 30 seconds right up until the close of the MOC at 4:30 pm Singapore time (0830 GMT).

Following any trade, there would be 30 seconds to rebid or re-offer. A one-minute extension period would be triggered by any price move or a rebid/re-offer in the 30 seconds prior to the close of the MOC.

Platts has established clearly defined timing guidelines and standards of incrementability that apply when publishing bids and offers in the MOC assessment process to ensure an orderly and transparent price assessment process, which can be found here: https://www.spglobal.com/commodityinsights/PlattsContent/_assets/_files/en/our-methodology/methodology-specifications/petrochemicals-timing-increment-guidelines.pdf

MTBE FOB Singapore factor: Platts would continue to publish the factor, which expresses the ratio between daily MTBE assessments basis FOB Straits and 92 RON gasoline assessments FOB Straits. The factor calculation uses the Mean of the low and high of Platts MTBE assessments and 92 RON cargo assessments, respectively.

Platts invites feedback on any other aspects of the MTBE coverage in Asia. This proposal follows a consultation published Aug. 28. https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/082824-platts-seeks-feedback-on-asia-mtbe-coverage.(opens in a new tab)

Please send all comments, feedback and questions to petchems@spglobal.com and pricegroup@spglobal.com by Nov. 12.

For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing.