10SEP2019 - NEWS - APEX signs licence to use Argus' Singapore low-sulphur fuel oil price

Global commodity price reporting and news agency Argus and the Asia Pacific Exchange (APEX) signed an agreement today licensing the use of the Argus Bunker Index (ABI) Singapore LSFO 0.5%S as the settlement price for a proposed new derivatives contract. The contract can be used by oil traders, bunker fuel suppliers and shipowners to manage their price risks related to the new low-sulphur fuel oil (LSFO) required to comply with the 0.5% sulphur cap being introduced by the International Maritime Organisation in January 2020 (IMO 2020).

ABI Singapore assessments were launched in June last year and are calculated using a volume-weighted average of fixed price delivered-to-ship bunker transactions between suppliers and shipowners reported to Argus by 7pm each day. More than 40 companies have voluntarily contributed their trade data over the previous year and typically more than 20 deals are submitted each day, making it a robust price assessment process. The LSFO 0.5%S index represents the price of bunker fuel delivered within 4-12 days from the trade date, for volumes between 500t and 3,000t, with viscosity of less than 380cst and sulphur below 0.5%.