Platts US Gulf Coast 3%S residual fuel oil assessment is a benchmark assessment that reflects the price of high-sulfur fuel oil at five locations within the Houston Ship Channel of Texas.
The benchmark, published under the data code PUAFZ00, is often referred to by many names, including No. 6 3%, Gulf Coast No. 6 3.0%S (Waterborne) Fuel Oil, Fuel Oil 3%S and Resid 3%.
Platts European fuel oil assessments are also used in electricity oil/gas indexed pricing and dark spread formations. The European utility market, now mostly dominated by Mediterranean outlets, sees a relatively small demand pool for low suflur fuel oil from oil-fired utility plants.
Fuel oil has a number of uses globally, though the largest market for the heavy, residual refined product is bunker fuel, where the material fuels large, sea-going vessels. This market sees upward of 250 million mt demand a year, globally, and our assessments are used to benchmark a great deal of this exposure.
USGC fuel oil is also exported for power generation in several Latin American and Caribbean countries, though its use in the power sector has been in decline for many years.
The Platts USGC HSFO price assessments are available in these Platts services.
Platts defines the location for our Gulf Coast fuel oil assessments as Houston comprised by five terminals: Battleground Oil Specialty Terminal (BOSTCO), Houston Fuel Oil Terminal (HOFTI or HFOTCO), Intercontinental Terminals (ITC), Magellan Galena Park and Bayport Container Terminal. We will consider other terminals in the Houston area but those indications could be normalized to the Houston Ship Channel.
Platts US Gulf Coast 3%S is assessed on an FOB basis for loading 7-15 days forward from the date of transaction. The minimum stem is 45,000 barrels. We publish the assessment as a fixed outright price. Fixed and floating price information will be considered in the assessment process.
All Platts fuel oil is assessed on a Market on Close assessment process basis.
Platts first began assessing USGC 3% fuel oil in 1979. The specifications were initially written to reflect electric utility demand as the primary end use.
Over the past decades, fuel oil use by electric utilities has declined significantly. While power generation once accounted for more than 50% of fuel oil demand in the US, it now accounts for approximately 10%.
Bunker fuel demand for fuel oil now accounts for 80% of total fuel oil consumption in the US.
US fuel oil imports have fallen dramatically, from almost 2 million b/d in the 1970s to about 150,000 b/d in 2015.
Following a review and formal proposal, Platts announced October 6, 2015, it will update the specifications reflected in its benchmark US Gulf Coast 3%S physical residual fuel oil assessment to reflect bunker grade RMG 380 3.5%S quality fuel oil, as per ISO 8217 specifications, with effect from January 3, 2017.
At the same time, Platts will also rename the assessment as "USGC HSFO" and standardize its name across all publications. These changes follow a review of the existing specifications announced May 27, 2015, and a formal proposal announced July 14, 2015. This assessment will continue to be published under the product code PUAFZ00. A full subscriber note can be found here.
Our USGC high sulfur fuel oil price assessment can be accessed in the following Platts services.
Price Assessment Methodology Explained Training
European Oil Storage Conference, 10th Annual
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Platts Market On Close Video