Platts clarifies freight assessments and EU ETS for European crude and refined products netbacks and net-forwards assessment calculations

Platts, part of S&P Global Commodity Insights, wishes to clarify that in its net-forward and netback oil assessments, it uses freight rates which are assessed and published by Platts in Worldscale points, lumpsum and $/mt values, in accordance to what is stipulated in the relevant methodology document.

A subscriber note published Nov. 2, 2023, clarified that Platts clean and dirty tanker $/mt, Worldscale point and lump sum freight assessments will continue to be assessed exclusive of carbon offset costs following shipping's inclusion in the European Union's Emission Trading System (EU ETS) from Jan. 1, 2024.The subscriber note can be reached here: https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/110223-platts-clarifies-tanker-freight-assessments-to-continue-to-exclude-eu-ets-carbon-offsetting-cost

Platts continues to monitor the evolution of freight markets in the context of the EU ETS and the impact on prevailing freight costs for crude and oil products.

More broadly, Platts wishes to remind that in its Market on Close assessment process, it may publish bids, offers and trades from locations other than the basis port and may normalize them back to the basis port for assessment purposes. In determining plausible origins or destinations and the gradient of freight normalization, Platts will take into account prevailing spot market flows, including any structural change in flows and prevailing freight rates at the time the bids, offers or trades are reported. This is subject to daily review and exercise of editorial judgment, as per existing methodology.

The methodology guide for Europe And Africa Refined Oil Products can be found here: https://www.spglobal.com/commodityinsights/plattscontent/_assets/_files/en/our-methodology/methodology-specifications/Europe-africa-refined-products-methodology.pdf

The methodology guide for Europe and Africa Crude Oil can be found here: https://www.spglobal.com/commodityinsights/plattscontent/_assets/_files/en/our-methodology/methodology-specifications/emea-crude-methodology.pdf

Please send any feedback, questions or comments to Europe_products@spglobal.com, Europe_Crude@spglobal.com and 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.