Russia launches oil product netbacks for three vast areas
News and price reporting agency Argus and Russian commodity exchange Spimex have launched netback price indexes for refined products in Russia in line with recommendations by the country’s federal anti-monopoly service FAS.
The new indexes developed jointly by Argus and Spimex are derived from Argus assessments for oil products prices in northwest Europe, the Mediterranean market and Asia-Pacific that are netted back to Russian refinery gate prices by subtracting export duty, freight, loading costs, and railway, pipeline or river transportation and associated costs. These indexes, together with exchange and OTC indexes published by Spimex, are designed to establish reliable price indicators and increase transparency in the Russian refined products market.
Argus and Spimex began publishing the netback indexes for regular and premium motor gasoline, summer diesel, jet fuel and fuel oil on 4 April. The netback price indexes were developed for three vast Russian federal multi-region territories – European Russia, the Urals and Siberia, and the Russian far east and Siberia. For this reason they are known as “territorial” indexes.
The indexes are available on the Spimex website, as well as in the daily Argus Russian Motor Fuels and Argus Russian Fuel Oil reports.
“We are delighted to be able to produce new indexes with Spimex that add to the transparency of the Russian refined products market. We are committed to the further long-term development of our reporting on Russian commodity markets, having had a presence in the country for over 20 years,” Argus Media executive chairman and publisher Adrian Binks said.
“The launch of the new indexes conforms to Spimex’s primary objectives — development of market pricing and creation of reliable market indicators for the most significant commodities,” Spimex president Alexey Rybnikov said. “We hope that this step that we make together with Argus will allow for better performance of our customers’ tasks of building sales channels and market analysis, and will meet the government’s requirements concerning control over the market situation.”
Indexes published in the daily Argus Russian Netbacks report are used as a basis for calculating the territorial netback indexes. Volume-weighted averages are calculated based on the netbacks at specific refineries, taking into account the volume of oil products sold by these refineries on Spimex.
Russian domestic market prices are often set at around parity with export values, because the country is one of the major global exporters of oil products.
Argus Russian Netbacks contains detailed daily calculations of export netbacks for crude, gasoline, naphtha, diesel, gasoil, jet fuel, vacuum gasoil, fuel oil, LPG, methane and base oils for all key Russian producers on major pipeline, rail and river routes. Argus calculates export netbacks taking into account key exporter costs, such as transportation and loading of standard cargoes.