Argus Launches New Prices for Heavy Canadian Crude Exports
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Argus Launches New Prices for Heavy Canadian Crude Exports
Global commodity price reporting agency Argus has made a significant move by introducing three new daily prices for heavy Canadian crude oil. This new pricing structure pertains to exports coming from the 590,000 b/d Trans Mountain Expansion (TMX) pipeline, a critical infrastructure recently operational that promises to enhance Canada’s role in the global crude market.
The TMX pipeline marks a transformative moment for Canada, as it bolsters access to Asian markets, providing Alberta—a landlocked region—an essential export pathway to the Pacific coast. This shift allows Alberta to significantly increase its reach and opportunity to supply heavy crude oil to Asian refiners.
The Canadian oil landscape is predominantly characterized by heavy crude production, which reaches approximately 5.35 million b/d. Until now, most of this has been transported via pipeline to the US. With TMX in operation, the capacity of the Trans Mountain pipeline system has increased enormously, now handling up to 890,000 b/d, a tremendous leap from the previous capacity of around 300,000 b/d.
Following this evolution, price discovery for Canadian heavy crude is gradually transitioning towards the coastal markets. The Argus assessment for Western Canadian Select (WCS) at Houston, located on the costly US Gulf coast, serves as the basis for one of the world's foremost markets for Canadian crude oil transactions. The new assessments from Argus for crude oil loaded from Vancouver and those destined for China are set to enhance price transparency on the Pacific coast. This coast is now one of the principal outlets for waterborne exports from Canadian producers.
Argus chairman and CEO Adrian Binks stated, "After extensive consultation with market participants, we are thrilled to launch assessments for TMX Canadian crude at Vancouver and delivered to China. This development is crucial as it offers much-needed price transparency amidst a changing supply dynamics driven by this newly accessible resource. Our new assessments are grounded in our established methodologies and draw upon the extensive expertise of Argus' teams spanning Calgary, Beijing, Shanghai, Houston, and Singapore.”
The recently introduced price assessments pertain to crude oil loaded from the TMX onto Aframax-sized (80,000t) tankers at the Westridge docks in Vancouver, paving the way for a more robust pricing environment.
The new prices include:
- Heavy, low-TAN (low-acid) Cold Lake-type crude
- Heavy, high-TAN (high-acid) Access Western Blend (AWB)-type crude
- Heavy, high-TAN crude delivered at Zhejiang, China
These prices will be updated daily in the Argus Crude and Argus Americas Crude reports, keeping all stakeholders well-informed of market conditions.
Furthermore, Argus publishes daily freight rates from Vancouver, enhancing comprehension of these emergent trade flows. These rates cover routes from Vancouver to China for Aframax ships, as well as shipments to the US West Coast. Notably, crude on these smaller vessels can conveniently be transferred to larger Very Large Crude Carriers (VLCCs) for bulk exports to China.
The newly published freight rates include:
- Vancouver to US West Coast 80,000t (Aframax)
- Vancouver to China 80,000t (Aframax)
- US West Coast to China 270,000t (VLCC)
- US West Coast ship-to-ship (STS) transfer charges
Contact Information
London: Seana Lanigan
+44 20 7780 4200
Houston: Matt Oatway
+1 713 968 0000
Singapore: Tomoko Hashimoto
+65 6496 9960
About Argus Media
Argus is the premier independent provider of market intelligence serving the global energy and commodity markets. We deliver essential price assessments, analytical perspectives, consulting services, and data-driven insights that illuminate the complexities of commodity markets.
With headquarters in London and a dedicated workforce of over 1,400 employees, Argus operates from 30 offices located in key global commodity trading hubs. We are committed to providing trustworthy data that companies, trading firms, and governments in 160 countries utilize for decision-making, risk management, trade facilitation, and long-term strategic planning.
Founded in 1970, Argus stands as a privately held company, owned primarily by employee shareholders and supported by the growth equity firm General Atlantic.
Frequently Asked Questions
What new prices has Argus launched for Canadian crude?
Argus has launched three new daily prices for heavy Canadian crude exported via the TMX pipeline, including low-TAN and high-TAN options as well as prices for crude delivered to China.
How does the TMX pipeline impact Canadian crude exports?
The TMX pipeline has increased export capacity significantly, allowing Alberta heavy crude to reach Asian markets, thus diversifying Canada’s export destinations.
Why is price transparency important for crude exports?
Price transparency helps market participants make informed decisions, facilitating smoother trade and improving market efficiency in oil pricing.
Which regions does Argus serve with its pricing assessments?
Argus provides pricing assessments that cover various regions, particularly focusing on Vancouver as a critical outlet for Canadian crude and its delivery to Asian markets.
What other services does Argus offer beyond price assessments?
In addition to price assessments, Argus provides market news, analytics, consulting services, and data-driven insights tailored for commodity markets.
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