April WTI Midland into Dated Brent Performance: 10 cargoes delivered

As trading activity in the Platts Market on Close assessment process reached all-time highs in April, 24 cargoes of WTI Midland traded in the assessment process, while 10 were delivered.

S&P Global Commodity Insights continues to closely monitor performance on all these trades as part of its ongoing commitment to upholding the highest standards of integrity and transparency. Post deal tracking has revealed full performance eventually reached on all trades tracked to date.

Pricing

WTI Midland's role in defining Dated Brent grew marginally through April assessments, alongside other grades such as Ekofisk, as light sweet fundamentals in Europe slackened considerably through the month and demand for Forties proved robust, particularly early in the cycle.

Peaking European refinery maintenance and a soft European middle distillate complex weighed heavily on sweet value through the month with differentials in leading crudes such as Ekofisk, Oseberg and WTI Midland sinking to multi-week lows.

Indeed, five of the six crudes in the Dated Brent basket defined the benchmark across at least one assessment day through April, with only Troll not playing a direct role in demonstrating value.

Trading activity for April reached all-time highs as 35 cargoes traded in the Dated Brent physical MOC, topping the record of 33 from November 2017. Of the 35 cargoes traded, 24 of which were WTI Midland cargoes, three of which were also traded with April laycans.

Performance Tracking

S&P Global monitored performance on 10 WTI Midland CIF Rotterdam trades published in the Platts Dated Brent MOC process in March and April for April delivery. As part of this, S&P Global has reviewed various aspects of performance, including timeliness of nominations and eventual delivery, as well as published parameters of the trades, including quality and volume.

Of the 10 trades tracked, eight were physically delivered to buyers, while two trades were mutually agreed to be booked out. Physical conditions regarding logistics which are beyond the control of the seller or buyer may result in lateness, quality issues or conditions seen as a deviation from the original wording in the reported trade, for example late delivery/loading. According to Platts methodology, if a transaction becomes difficult, the party causing the issue must seek resolution including alternative loadings, qualities, dates or book outs.

S&P Global also reviewed the quality of all cargoes, and the table below shows the minimum and maximum values of some key quality metrics during this timeframe. All cargoes that were eventually delivered to buyers met the specification.

The table linked shows the transactions that were monitored for performance in April: