Oil products: ARGUS US Gulf Colonial pipeline Cbob price assessment

Oil products: ARGUS US Gulf Colonial pipeline Cbob price assessment

The Argus US Gulf Colonial Cbob price assessment

Colonial pipeline Cbob is the most liquid physical gasoline market in the world, with trade volumes sometimes approaching 1mn b/d.

Argus is the top provider of price assessments for this market and the most commonly referenced PRA.

What is Colonial Cbob?

Conventional blendstock for oxygenate blending (Cbob) is the US standard gasoline, typically blended with 10pc ethanol to make a finished on-road gasoline. In the Colonial market, the fuel is delivered to buyers at Colonial Pipeline injection points across the Gulf coast. It is then the buyer’s responsibility to pipe the fuel on to terminals along the eastern US seaboard. Spot trade is standardised to injection at Pasadena, Texas, and buyers compensate sellers for product that is delivered further downstream, closer to the final customer.

The Argus USGC Colonial Cbob assessment is now listed on the Intercontinental Exchange (ICE).

This monthly, cash-settled future allows users to take on financial exposure in the US gasoline market.

View the ICE contract listing for more details.

Advantages of the Argus Colonial Cbob price assessment

Argus incorporates more Cbob market liquidity than any other price reporting agency, gathering trade data throughout the entire working day and from all segments of the market. Refiners, distributors, retailers, and trading companies have accepted this methodology as the most appropriate, the most representative and the most robust.

Users of the Argus Colonial Cbob price assessment

Argus Colonial Cbob price assessments are used in long-term contracts, spot transactions, downstream pricing, transfer pricing, spot sales and exports overseas. These price assessments are also used to settle financial derivatives listed on ICE.

Argus Colonial Cbob futures

These contracts settle against the daily Argus price assessments set out in the contract terms – typically an average of assessments over the named calendar month.

Argus Colonial Cbob futures can be used to lock in existing exposure to Argus Cbob prices, or simply to take new financial exposure to this market. Use cases include:

  • Hedging long-term supply contracts all the way from the US Gulf to the mid-Atlantic
  • Hedging arbitrage trades between regions
  • Taking exposure to Gulf coast time structure
  • Trading Gulf coast gasoline cracks
Eurobob oxy gasoline

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