Platts proposes to publish East Texas CBOB, premium CBOB assessments

S&P Global Platts is proposing to publish two new calculated assessments reflecting East Texas CBOB and premium CBOB gasoline, effective March 1, 2021.

The assessments would be published throughout the year and would reflect changes in RVP based on US Environmental Protection Agency regulation. Platts invites feedback regarding the timing around 7.8 psi (after ethanol blending) summer RVP requirements.

The new assessments come after Platts discontinued the CBOB 87 USGC Pipeline Supplemental (AASOB00) and CBOB 93 USGC Pipeline Supplemental (AASOC00) assessments on Sept. 1, 2020. Platts understands that those previous assessments had provided useful information for the East Texas CBOB market. The new assessments will directly reflect that market, but will not reflect pipeline product as they are not fungible Colonial Pipeline gasoline grades.

Platts understands there is no spot market for East Texas CBOB, particularly the summer 7.8 psi (after ethanol blending) specification. The assessments will, therefore, be calculated using the lowest fungible Colonial Pipeline CBOB (AARQU00) and premium CBOB grades (AARQV00), and a published RVP adjustment to account for the difference in RVP. Platts is seeking feedback regarding the location basis for the assessment.

Platts began publishing a 1 psi RVP adjustment for CBOB and premium CBOB in March 2020 that reflected 1 psi above the RVP of the main CBOB and premium CBOB assessments in the winter, and 1 psi below the RVP value of the main assessments in the summer. As of Jan. 4, 2021, it will assess four year-round adjustments: CBOB plus 1 psi, CBOB minus 1 psi, premium CBOB plus 1 psi and premium CBOB minus 1 psi. These adjustments will be used to calculate East Texas CBOB and premium CBOB depending on how its specifications relate to fungible Colonial Pipeline CBOB at different points in the year.

To calculate a 7.8 psi (after ethanol blending) East Texas CBOB price on May 1, for example, Platts would use the following formula: Colonial CBOB + (CBOB minus 1 psi * (Colonial CBOB RVP – East Texas CBOB RVP)).

The East Texas area is not supplied by Colonial Pipeline, and it is the last remaining 7.8 psi CBOB (after ethanol blending) region in the southern US. The area involves 95 counties where the summer restriction applies from May 1 through October 1 of each year. This area is typically supplied via Explorer and Plantation pipelines, among others

The assessments will be published as outright prices and differentials to NYMEX RBOB in cents/gal.

These prices will appear on Platts Global Alert pages 330, as well as in US Marketscan. The main assessments for these and other gasoline grades will not be affected by this proposal.

Please provide comments or feedback on this proposal by January 15, 2021, to americas_products@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.