Platts clarifies CFR Japan naphtha assessment basis and treatment of commercial contracts

Platts, part of S&P Global Energy, would like to clarify the basis of its CFR Japan naphtha assessments and the application of contractual terms in the related Platts Market on Close assessment process, following recent market feedback and information regarding the Open Specification Naphtha contract.

Platts assesses CFR Japan naphtha based on its published methodology and specifications, reflecting prevailing market price through observable spot market information, including bids, offers and trades.

The Platts CFR Japan naphtha assessment reflects the price of light paraffinic naphtha delivered CFR Japan in accordance with Platts published specifications and delivery standards.

Platts does not require transactions reported in the CFR Japan naphtha MOC to be executed under any specific commercial contract, provided that the buyer and seller have mutually agreed contractual terms, and all applicable Platts methodology requirements are met.

Platts understands that market participants may use a range of commercially agreed contractual frameworks in the physical naphtha market. The use of any specific contractual framework is not a prerequisite for trades to be reported in the naphtha MOC.

All bids, offers and trades reported through the MOC must continue to meet Platts methodology requirements, including applicable quality, operational and performance standards.

Recent market communications regarding the OSN contract do not result in any change to Platts CFR Japan naphtha assessment methodology or standards.

Further details on the specifications reflected in Platts CFR Japan naphtha assessments can be found in the Asia Pacific and Middle East Refined Products Specifications Guide.

Platts is closely monitoring the development in the Asian naphtha market and will continue to engage with market participants on any factors that may affect market liquidity, transparency, deliverability or representativeness. Any future methodology changes will be communicated through the standard methodology review process.

Please send any feedback or comments to asia_products@spglobal.com and pricegroup@spglobal.com.

For written comments, please provide a clear indication if they are not intended for public viewing. Platts will consider all comments received and will make those not marked as confidential available upon request.