Platts, part of S&P Global Commodity Insights, will no longer reflect Russian material as part of its open-origin assessment of low- and high-sulfur fuel oil cargoes and all bunker assessments in Asia and the Middle East, effective March 1, 2023.
This decision follows a consultation to review the merchantability of Russian material in the Asian high- and low-sulfur fuel oil and bunker markets by Platts announced on Feb. 10: https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/021023-platts-invites-feedback-on-merchantability-of-russian-material-in-asia-fuel-oil-bunker-assessments
The majority of feedback that Platts received suggested that Russian-origin material was no longer merchantable in the open-origin Asian fuel oil and bunker markets and supported its exclusion from the relevant Platts assessments.
Platts has observed an increasing number of participants in the Asian fuel oil Market on Close assessment process is already restricting delivery of Russian-origin material in its bids, offers and trades.
Feedback received ranged from concerns around breach of previously announced international sanctions on Russia to potential implications for trading operations from the Feb. 5 G7 price caps on seaborne Russian petroleum products. Platts understands that oil market participants in Asia typically use G7-domiciled trade financing, shipping and insurance services to facilitate trade.
During the consultation, Platts also noted diverse definitions of origins used by companies restricting Russian material as well as how the G7 price cap applies through supply chain operations such as blending. Platts will continue to observe evolving market practice to ensure its origin standards remain consistent with the broader market.
Effective March 1, all Asian fuel oil and bunker assessments will be subject to Platts origin standards as defined in a subscriber note June 23, 2022.
In the note, Platts stated that its assessments that exclude Russian-origin material reflect oil that is not wholly, or in part, produced, manufactured or processed in Russia, or exported from Russia. These assessments also reflect transactions where the performing vessels are not Russian flagged/registered or Russian owned. The subscriber note is available here: https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/062322-platts-clarifies-standards-for-assessments-that-exclude-russian-origin-material
MOC participants must note that all trades reported in the assessment process are subject to Platts performance review. As part of its trade performance review, Platts may seek additional information or documentation from market participants to ensure compliance with Platts standards and guidelines.
Russian-origin product has already been excluded from Platts benchmark cargo price assessments for gasoline, naphtha, gasoil and jet fuel in Asia, as well as from all refined product assessments in Europe.
Effective March 1, Russian-origin material will be excluded from the following assessments:
HSFO 180 CST ($/mt) PUADV00
HSFO 380 CST ($/mt) PPXDK00
Marine Fuel 0.5% ($/mt) AMFSA00
Ex-Wharf 380 CST ($/mt) AAFER00
Ex-Wharf 500 CST ($/mt)
FO 180 CST 2% ($/mt) PUAXS00
FOB Arab Gulf/Fujairah:
HSFO 180 CST ($/mt) PUABE00
HSFO 380 CST ($/mt) AAIDC00
HSFO 380/180 spread ($/mt) PPXDM00
HSFO 380 CST ($/mt) AFUJQ00
Ex-Wharf 380 CST ($/mt) AAYBF00
Marine Fuel 0.5% ($/mt) AMFFA00
The change also applies to Platts assessments of Marine Fuel 0.5% bunker, 380 CST high sulfur bunker, 500 CST high sulfur bunker, Marine Diesel 0.5%, Marine Gasoil 0.5%, Marine Diesel 0.1% and Marine Gasoil 0.1% in Singapore, the UAE, Japan, South Korea, Hong Kong, China, Australia, India, Sri Lanka and Kuwait. The relevant assessments and their publication symbols can be found in the specification guide for global bunker fuels available here: https://www.spglobal.com/commodityinsights/en/our-methodology/methodology-specifications/shipping/global-bunker-fuels
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