Argus welcomes Ofgem support for extending Iosco PRA principles
London, 8 July 2014
Global energy and commodity news and price reporting agency Argus welcomes today’s decision by UK gas and power markets regulator Ofgem to support the voluntary extension to gas and electricity benchmarks of the principles for oil price reporting devised by international regulators group Iosco in 2012.
Argus’ commitment to best practice in commodity price reporting is shown by its continuing compliance with Iosco’s PRA principles across all its commodity benchmarks.
The Iosco PRA principles were published in October 2012. They were endorsed by the G20 in November 2012. They cover governance, control, quality, integrity and conflict management in relation to commodity benchmark price assessments published by PRAs. One of the requirements is an annual external audit, which Argus has met under reviews by global accountancy group PwC.
Argus became the first PRA to successfully complete an external assurance review of its generating fuels and coking coal benchmarks in February this year, extending its application of the PRA principles beyond oil to encompass benchmarks in thermal coal, coking coal, natural gas and biomass.
“We were pleased to be the first PRA to successfully complete assurance reviews of our benchmark prices. We are furthering that commitment to the PRA principles by conducting another independent assurance review this summer,” Argus Media chairman and chief executive Adrian Binks said.
Argus completed an independent external assurance review of the policies and processes it uses in establishing price benchmarks in oil markets in October 2013.
“We strongly support extending the scope of the Iosco Oil PRA principles to price assessments for gas and electricity markets on a voluntary basis,” an open letter from Ofgem says today.
Ofgem’s support for extension of the PRA principles is an interim measure pending the outcome of a European Commission proposal on benchmarks and Iosco’s consultation on extending the PRA principles.
Ofgem points out that the EU’s Remit legislation “will improve regulators’ visibility of the market and in turn the activities of the PRAs” as market participants will have to report details of their trading activity to EU regulator Acer. Remit came into effect in December 2011. It prohibits market abuse, including manipulation of benchmarks, in wholesale gas and electricity markets.
Ofgem’s open letter follows its call for evidence last year on price benchmarks produced by PRAs.
Argus’ description of its policies and procedures together with the full assurance review report are available at www.argusmedia.com/About-Argus/How-We-Work
Argus methodologies are published at www.argusmedia.com/Methodology-and-Reference
The Iosco PRA principles are available at www.iosco.org/library/pubdocs/pdf/IOSCOPD391.pdf
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About Argus Media
Argus is an independent media organisation with almost 600 full time staff. It is headquartered in London and has offices in each of the world’s principal commodity centres. Its main activities comprise publishing market reports containing price assessments, market commentary and news, and business intelligence reports that analyse market and industry trends.
More than half of Argus employees 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 a compliance and ethics policy that align with best journalistic practice, including the avoidance of conflicts of interest.
Argus is a leading provider of data on prices and fundamentals, news, analysis, consultancy services and conferences for the global crude, oil products, natural gas, electricity, coal, emissions, bioenergy, fertilizer, petrochemical, metals and transportation industries. Data provided by Argus are widely used 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 commodity industries. Argus was founded in 1970 and is a privately held UK-registered company.