Shell Proposes Adding Russian Oil to Brent BenchmarkSource: Reuters 5/10/2017, Location: Asia
Royal Dutch Shell on Wednesday urged oil pricing agency S&P Global Platts to protect the dated Brent crude benchmark from declining North Sea supply by including other grades, such as Russian Urals, in its price-setting process.
The suggestion marks a shift from two years ago when Shell said adding Urals would not be "worth the trouble".
The benchmark, based on light North Sea crude grades, is used to price about two-thirds of the world's oil but a decline in North Sea output has led to concerns that physical volumes could become too thin and prone to large price swings.
Platts announced it would add a fifth grade, Troll, to the benchmark slate from January 2018 but Shell says more must be added in the next two to three years and considers Russian medium sour Urals as a top candidate.
The benchmark is now made up of Brent, Forties, Oseberg, and Ekofisk, known as BFOE.
"A good benchmark need not only be representative of what the region produces ... If you had to pick one grade of crude, Urals is the one which northwest European refineries should be designed to run optimally," Mike Muller, vice president of crude trading and supply at Shell, told the Platts Crude Summit in London.
Muller also suggested the price of dated Brent be derived from the average price of a basket of crudes, rather than by using the lowest priced of the four BFOE crudes on any given day. This would simplify the price-setting process, he said.
Two years ago, Muller said European refineries were already free to buy Urals - a crude stream that dwarfs North Sea streams in volume - as a substitute to the North Sea Forties grades as they are similar in quality.
Muller also called for the formation of a committee of independent experts to consult with Platts and the wider industry on future changes to the benchmark in order to ensure the views of all market players were represented.
Shell is one of the world's largest crude traders and one of the most active players in both the North Sea and Urals markets.
Shell's North Sea production is set to drop by more than half to about 110,000 barrels per day after the sale of a large package of North Sea assets to private equity-backed Chrysaor last year. But Shell will market Chrysaor's volumes for several more years.
Crude Oil News in Russia >>
India >> 12/12/2017 - Asian product crack spreads in October are on a gradual downward trend, despite solid regional demand and some support from naphtha and ongoing refine...
India >> 11/20/2017 - In September, India’s crude imports dropped from a month earlier by a slight 22 tb/d, to average 4.3 mb/d. Y-o-y, crude imports reflect a drop of 57 t...
Iran >> 11/20/2017 - Irans petroleum minister has stated that French energy giant Total - that has won a deal to develop a key gas project in the country - can quit only i...
Iran >> 11/18/2017 - National Iranian Oil Company (NIOC) and Singapore"s Berlanga signed a memorandum of understanding (MoU) for the latter to start studies on development...
Indonesia >> 11/16/2017 - Electromagnetic Geoservices ASA (EMGS) is pleased to announce that it has received Letters of Intent for two contracts under which EMGS will perform p...
Malaysia >> 11/16/2017 - ET Energy, a global leading clean energy developer and operator has announced that the company together with its partner Northwest Electric Power Desi...
Fluids Drilling, Completion, Workover & Stimulation
Gasoline (Lead free)
Kerosene. Domestic use
Lubricants, Oils & Greases
Oil Treating & Refining
Related Articles: Aromatic Solvents Butene Cleaning Corrosion Inhibiting Crude Oil Diesel Fuel Ethylene Fluids Drilling, Completion, Workover & Stimulation Fluids/Chemicals Fracturing Sand Fuel oil Gasoline (Lead free) General Jet fuel Kerosene. Domestic use Lubricants, Oils & Greases Nitrogen Oil Treating & Refining Polyethylene Polyvinyl chloride Propane Sand, Sandblast Surfactants
|Russia Oil & Gas 1 >> 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 | 20 | 21 | 22 | 23 | 24 | 25 | 26 | 27 | 28 | 29 | 30 | 31 | 32 | 33 | 34 | 35 | 36 | 37 | 38 | 39 | 40 | 41 ||