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Argus Media expresses confidence in its UK gas price assessments

London, 14 November 2012

Argus Media has responded to press allegations that companies trading at artificially low prices manipulated the UK natural gas price assessment published by its competitor Icis Heren on 28 September 2012 by reviewing its own gas market report and data for that day. Argus is confident that its gas price assessments that day correctly followed a robust methodology that is designed to identify the prevailing market price.

Argus cannot comment on Icis Heren’s assessment process on 28 September 2012. Press reports have highlighted an incident regarding price assessments published by Icis Heren on that day for the day-ahead UK national balancing point (NBP) contract, alleging successful manipulation of this price assessment.

In response to these press reports, we have reviewed Argus European Natural Gas for 28 September 2012. The Argus global compliance officer carried out a check on the market data inputs that our journalists used to identify the prevailing NBP day-ahead price for that day. He concluded that we adhered to our methodology on 28 September and excluded unrepresentative trades, which is in line with Argus procedures.

Argus considered data on deals obtained by its journalists, but only in the context of all of the other market information that we gathered, in line with our methodology. In this context, some of the deals data obtained by Argus were not used to identify the prevailing price because they were considered unrepresentative.

Argus’ journalists, as usual, contacted a range of market participants on 28 September 2012, basing assessments on all of the information collected, including prevailing bid and offer levels. The price assessments that Argus published on that day were a bid of 58.40 pence/therm (p/th) and an offer of 58.60p/th, with a midpoint of 58.50p/th.

Argus competes with Icis Heren among others in providing information on natural gas markets, including price assessments and indexes, commentaries, news and analysis. Press reports state that the NBP day-ahead price published by Icis Heren on 28 September was 58.25 p/th, reflecting a few unusually low trades of 58.00p/th at the close of trading (4:30pm). These reports suggest that the price should have been reported as 58.50p/th, implying that the deals done at 58.00p/th were manipulative.

UK secretary of state for energy and climate change Ed Davey told parliament yesterday that he is “extremely concerned about the allegations”. The UK’s main energy suppliers have denied any involvement in market manipulation. UK regulators the Financial Services Authority and Ofgem have said they will investigate the allegation of price manipulation.

Argus is alert to the possibility of attempted market manipulation and has procedures in place to ensure that our price assessments represent prevailing market conditions. Intentional manipulation of markets is already illegal, and Europe’s new Remit regulation explicitly prohibits market manipulation in gas and power markets. When EU member states implement Remit next year, they will provide their regulators with additional powers to investigate cases of manipulation and apply sanctions where market abuse is proven. Argus has worked extensively with international regulators for several years and continues to do so.

About Argus European Natural Gas Assessments

The methodology for the Argus European Natural Gas report states that the report “publishes prices that report and reflect prevailing levels for open-market arm’s length transactions”. The NBP day-ahead assessments reflect “best bid and best offer available at end-of-day” which is 4:30pm UK time, the methodology states.

Many types of market information are collected and used when determining the price, one of which is reported deals. But Argus reserves the right to reject deals as an authoritative input if these deals are deemed unrepresentative or unrepeatable, given other market data such as bid and offer levels. Argus surveys a wide range of buyers, sellers and other market participants to ensure that price assessments are founded on a basis of the fullest knowledge and market intelligence.

The Argus European Natural Gas methodology is publicly available at

About Argus Media

Argus is an independent media organisation with more than 450 staff. It is headquartered in London and has offices in each of the world’s principal energy centres. Its main activities comprise publishing market reports containing price assessments and commentary, and business intelligence reports that analyse market and industry trends.

More than half of Argus’ staff are commodity journalists who specialise in reporting news and price information relating to physical energy and related commodity markets. They operate according to a rigorous Editorial Code of Conduct and an Ethics Policy that align with best journalistic practice, including the avoidance of conflicts of interest.

Argus is a leading provider of price assessments, business intelligence, market data, consultancy services and conferences on the global crude, oil products, natural gas, electricity, coal, emissions, bioenergy, fertilizer, petrochemical and transportation industries. Data provided by Argus are widely used by companies and taxation authorities for indexation of physical trade. Companies, governments and international agencies use Argus information for analysis and planning purposes.

Argus has 19 offices globally, including London, Houston, Washington, New York, Calgary, Rio de Janeiro, Singapore, Dubai, Beijing, Tokyo, Sydney, Moscow, Astana and other key centres of the energy industry. Argus was founded in 1970 and is a privately held UK-registered company.

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Seana Lanigan
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