North Sea benchmark shift increases volatility

摘要

Recent North Sea trading activity suggests that the Brent benchmark could be moving to a delivered pricing model, but short-term volatility is on the rise. Changes in the way that price reporting agency Platts calculates Dated Brent — the equivalent to Argus’ North Sea Dated — appear to have led to a change in the way North Sea benchmark grades trade. The Dated Brent price — in common with North Sea Dated — has for some years been based on the lowest priced of fve North Sea grades loading on a fob basis in the North Sea. But Platts began to consider ofers and deals on a cif Rotterdam basis when setting Dated Brent in October. The system was designed to increase the number of trades used to as- sess the benchmark and to limit the scope for participants to bid up the price of the fve grades without realistic prospects of doing a deal.