American Oil and Gas Reporter - February 2021 - 31

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A market maker can specify general terms
and conditions (GTCs) in the terms,
quality and conditions box in the tool,
but existing bilateral GTC arrangements
take precedence.
Any trades concluded during the MOC
price assessment process would follow
the established market standard of operational tolerance +/-5% at the buyer's
option subject to physical limitations of
the vessel and dock.
Bids or offers that cannot be logistically performed upon are not published.
Any data not reflective of the market or
market standards will not be included
in the final Platts price assessment. For
instance, a bid for an 800,000 barrel
cargo loading FOB Nederland may be
removed from the publishing process
given the 600,000-barrel draft restriction
for cargoes loading from that location.
Participants who submit a bid or offer
in the MOC process must be contactable
for as long as the bid or offer remains
live.
r
Editor's note: For more about AGS,
visit http://plts.co/d9vR50Dx928.

Participation and Physical Performance
Market participants can submit bids
and offers through the FOB U.S. Gulf
Coast eWindow tool with a laycan window
as narrow as five days and as wide as 10
days. If a trade occurs in the MOC assessment process, once a terminal has
been nominated, counterparties would
communicate bilaterally to narrow the
laycan to two days within the established
window, as per current industry practices.
S&P Global Platts expects any counterparties that report a trade in the MOC
assessment process to employ previously
established credit and operational terms.
FIGURE 3

U.S. Crude Output and Exports
3,800

13,000

3,600

12,500

3,400
12,000
3,200
3,000
11,000

2,800

10,500

Mb/d

11,500

2,600

Nov-22

Jul-22

Sep-22

May-22

Jan-22

Mar-22

Nov-21

Jul-21

Sep-21

May-21

Jan-21

US crude production (left axis)

Mar-21

Nov-20

Jul-20

Sep-20

May-20

Jan-20

Mar-20

Nov-19

2,000
Jul-19

9,000
Sep-19

2,200

May-19

2,400

9,500

Jan-19

10,000

Mar-19

Real-Time Communication
S&P Global Platts assesses global
crude markets under the premise that
price is a function of time. Assessments
are based on determining outright tradable
value throughout the trading day, culminating in an end-of-day value at typical
market closing time, which is 1:30 p.m.
Central Standard Time in the United
States.
Platts eWindow® is a real-time communication tool developed in collaboration with ICE that allows reviewed
market participants to publish bids,
offers and expressions of interest used
in Platts Market-On-Close (MOC) price
assessment process. For U.S. waterborne
crude, the eWindow instrument-the
mechanism by which bids and offers
are input-offers flexibility to accommodate the varied structure of deals in
this market.
The MOC process provides a mecha-

nism for market participants to transpaently demonstrate value to Platts using firm
market information. A firm bid, open to
the market, demonstrates that value is
above the bid level, precisely as an offer
demonstrates that value is below the
offer level as long as the bid or offer remains standing. This market information
would be used in determining the assessment.

Mb/d

so cargo sizes between 550,000 and
800,000 barrels may be used in the assessment.
Normalization of cargo sizes that deviate from the typical is critical for this
broadly representative benchmark. S&P
Global Platts understands that FOB value
is sensitive to cargo size as buyers look
to optimize their per barrel freight cost.
Bids, offers and trades that deviate from
the 700,000 barrel typical would be normalized to reflect the freight economics
of the typical cargo size using that day's
U.S. Gulf Coast to UK Aframax assessment.
AGS reflects U.S. Gulf Coast ports
including Houston, Texas City, Nederland,
Beaumont, Port Arthur and Corpus Christi.
The most competitive port on a cargosize adjusted basis defines the overall assessment.
The assessment reflects cargoes loading
15-45 calendar days forward of the publication date, meaning a continuous loading
program freed from monthly pipeline cycles.

US crude exports (right axis)

MATT
EVERSMAN

Matt Eversman manages the Americas crude and fuel oil pricing team at S&P Global
Platts, providing operational and strategic direction for a group of two managing editors and
seven front-line reporters. He worked closely with Platts' Price Group, Structured Market
Engagement, and other teams in the development and rollout of Platts AGS. Prior to joining
the price reporting agency space in 2013, Eversman worked in finance as an investment analyst. He holds a B.A. in economics from Bucknell University.
FEBRUARY 2021 31


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American Oil and Gas Reporter - February 2021

Table of Contents for the Digital Edition of American Oil and Gas Reporter - February 2021

Contents
American Oil and Gas Reporter - February 2021 - 1
American Oil and Gas Reporter - February 2021 - Cover1
American Oil and Gas Reporter - February 2021 - Cover2
American Oil and Gas Reporter - February 2021 - Contents
American Oil and Gas Reporter - February 2021 - 4
American Oil and Gas Reporter - February 2021 - 5
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American Oil and Gas Reporter - February 2021 - Cover3
American Oil and Gas Reporter - February 2021 - Cover4
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