Argus launches ‘LSFO 0.5%S’ delivered bunker assessment for Singapore market
Argus today (Monday, 24 September) became the first price reporting agency to announce an assessment for low sulphur fuel oil delivered bunkers.
The specifications of the newly launched assessment are 0.5%S max, 180cSt max, 500-3,000 stem size with delivery 4-12 days from the trade date.
Argus, which re-launched its HSFO 380cst and LSMGO delivered bunker fuel assessments for Singapore in June, currently has 28 companies submitting deal information into their bunker assessment process which is based on Volume Weighted Averaging (VWA) of reported deals that meet standard specifications.
“The support we’ve been receiving from ship owners, suppliers and traders has been overwhelming,” Alan Bannister, head of Asian business development for Argus, tells Manifold Times.
“We’ve found the appetite for high quality delivered HSFO and LSMGO assessments to be used in bunker contracts, and eventually for hedging, is enormous. That isn’t surprising given the number of companies who’s primary physical exposure is to the delivered price rather than the cargo price.
“Market participants want to know how they can switch their contracts to Argus Delivered Bunkers, and it became apparent that there is already pent up demand for an assessment that can be used from 2020, which is what we’ve now provided with the launch next week of our LSFO 0.5%S assessment.
“Although there is a limited physical market today, the intent is that the market now knows the specifications, methodology and name of the assessment, which is what’s needed to reference it in contracts.”
The addition of an assessment for low sulphur fuel oil delivered bunkers at Singapore may also clear the way for a flurry of bunker contract discussions for 2020, previously held back by the lack of clarity on what assessment specifications and methodology would be used, he adds.
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Photo credit: Argus Media
Published: 24 September, 2018
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