Platts AGS is assessed by S&P Global Commodity Insights based on market information gathered during the day by market reporting staff and bids, offers, and trades published on the Platts eWindow communication tool. The assessment follows Platts Market on Close principles with bids, offers, and trades – converted to outright values for comparison – determining value at the 1:30 Central Time close.

Platts AGS by S&P Global Commodity Insights brings the US oil market a new benchmark assessment that reflects the value of high-quality, export-ready crude at the intersection of domestic and global demand, free of any distortion from logistics.

• Platts AGS strengthens against forward Dated Brent
• US crude exports to fall on week on lower flows to Asia: cFlow

Platts American Gulf Coast Select, while assessed stronger against both the 15 to 45 day-forward NYMX WTI and Dated Brent strips on July 1, weakened against WTI MEH amid a sharp narrowing in the Brent/WTI strip.

Against the forward NYMEX WTI strip, Platts AGS, which represents Midland-spec WTI crude for export out of the US Gulf Coast on an FOB basis, was assessed just 1 cent stronger July 1 at a $6.91/b premium to cash WTI. Against the forward Dated Brent strip, Platts AGS strengthened 32 cents off its all-time low differential to a $2.71/b discount. On an outright basis, Platts AGS was assessed at $112.87/b, or a $2.89/b premium to August WTI MEH, down from a $3.30/b premium from the day prior. While the Platts AGS outright value can appear strong against WTI MEH, sharp backwardation in the market structure and a large portion of the assessment strip encompassing July loading dates pulls up the strip average.

The first-decade August loading portion of the Platts AGS strip was assessed just $1.10 over August WTI MEH. This came as the Brent/WTI swaps spread, one indicator of the competitiveness of US crude on the international market, narrowed 81 cents to $3.33/b. As the swaps spread narrows, WTI-based crudes are often considered as becoming less competitive in relation to their Brent-based counterparts, thus applying downward pressure on values.

Meanwhile, US crude exports over the week ended July 1 were expected to have fallen from the week prior to 2.697 million b/d, according to Platts cFlow ship and commodity tracking software from S&P Global Commodity Insights. This was down more than 1 million b/d from cFlow’s estimate for the week prior, while down nearly 700,000 b/d from the US Energy Information Administration reported level for the week ended June 24.

The overall fall in US export volumes appears largely driven by a decrease in flows to Asia. Data from cFlow estimated crude exports to Asia over the week ended July 1 at just 620,000 b/d, down from over 1.8 million b/d of export flows in the week prior. Flows to Europe were estimated to hold steady at 1.2 million b/d. These values are subject to some change as data is further analyzed.