Canadian Crude Oil Trades on Argus WCS Index
Calgary, 6 October 2011
Canadian crude oil price indexes published by global energy price reporting agency Argus were used today as the basis for spot trade of Western Canadian Select (WCS).
Two deals were brokered by Atlas Petroleum Markets between a trading house and a large US refiner, one for November and one for December pipeline injection. The deals were indexed to the arithmetic average of Argus daily volume-weighted WCS indexes for the November and December trade months.
Argus began publishing a daily volume-weighted price index for WCS crude blend at Hardisty in August 2010. The index is based on voluntary reporting of trades from an array of market participants. The Argus WCS index strives to capture the widest range of trade in the Canadian spot market by accepting both brokered and bilateral deals into the index. The Argus index measures the price discount of WCS to the calendar month average of settlement prices for NYMEX's light sweet crude contract.
So far this year, the Argus trade month average index for WCS has been backed by an average of over 140,000 b/d of market transactions.
Argus Media chairman and chief executive Adrian Binks said: "We believe an independent index will attract more liquidity to the WCS market, and we have worked closely with the industry to develop this."
Argus volume-weighted price indexes for WCS and light sweet Syncrude are published in Argus Crude and Argus Americas Crude each day. Price data may also be accessed via web-based licenses or via third-party providers.
WCS is a blend of bitumen, light synthetic crude and conventional diluents, that has become the pricing benchmark for a wide range of heavy crude streams in western Canada. It is blended and sold at the market hub of Hardisty in eastern Alberta, with access to the US via multiple pipeline systems. The creators of the WCS stream are Cenovus, Canadian Natural Resources, Suncor and Talisman.
Argus crude price assessments are used extensively worldwide, including the use of the ASCI™ benchmark by Saudi Arabia, Kuwait and Iraq for the pricing of all crude sold into the US. Argus assessments for light sour Russian blend ESPO at the Siberian port of Kozmino were used to price two ESPO cargo sales by TNK-BP in August of 2011.
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Argus Media is a leading provider of price assessments, business intelligence and market data on the global crude, oil products, natural gas, electricity, coal, emissions, bioenergy, fertilizer and transportation industries. It is headquartered in London and has offices in Houston, Washington, New York, Portland, Calgary, Johannesburg, Dubai, Singapore, Tokyo, Beijing, Sydney, Moscow, Astana, Kiev, Santiago and other key centers of the energy industry. Argus was founded in 1970 and is a privately held UK-registered company.
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