HOUSTON, Feb. 26, 2015 /PRNewswire/ -- Global energy and commodity news and price reporting agency Argus today launches its much-anticipated assessment for West Texas Intermediate (WTI) crude oil delivered to Houston.

The new price assessment, based at Magellan's East Houston terminal, marks a milestone in the development of light sweet crude markets at the US Gulf coast.

"A new spot market has emerged in the oil capital of the US," said Euan Craik, Argus CEO Americas. "We have consulted widely and constructed the WTI Houston price in a way that reflects actual trade of a well-defined crude stream."

Rising production in west Texas is flooding Houston with WTI, but traders of the light sweet crude have been forced to value it with distant benchmarks, like Louisiana's LLS or Midland WTI, both also published by Argus. The new Argus WTI Houston assessment removes the basis risk inherent in using a more distant price benchmark.

The new assessment will be set by a volume-weighted average of all trades done during the day at Magellan's East Houston terminal. This mirrors the methodology used for other Gulf coast crude prices published by Argus.

Nearly 500,000 b/d of WTI from west Texas arrives at Magellan East Houston, where the terminal operator puts it into segregated tankage and makes spot trade possible within those tanks. Blended "domestic sweet" crude is not allowed into those tanks, so the trades there reflect a very specific quality of crude.

Today's launch of Argus Houston WTI complements widely-used Argus price indexes for LLS at St James and WTI Midland, giving each region of the US Gulf coast a local and liquid light sweet crude price benchmark. Traders of other sweet crude and condensate in the Houston area will now be able to refer to values set in the WTI market at Magellan East Houston as a clear signal of value.

Magellan's East Houston terminal currently has 4.5mn bl of crude oil storage capacity and the company is considering adding up to 5mn bl of additional storage capacity.

Argus WTI Houston will be published in the daily Argus Americas Crude and Argus Crude reports, and will be available through Argus Direct, the company's online platform.

Notes to editors

WTI refers to West Texas Intermediate crude, a light low-sulphur crude oil. Domestic sweet crude is also light and low in sulphur, but is often the result of blending of several crude grades, some of which have high levels of nickel, vanadium and acids known as TAN. Further details can be found at www.argusmedia.com/methodology

Request more information on the Argus Houston WTI and other Argus crude price assessments

Houston
Gabriela Alcocer
+ 1 713 968 0000
gabriela.alcocer@argusmedia.com

London
Seana Lanigan
+44 20 7780 4272
seana.lanigan@argusmedia.com

Singapore
Jim Nicholson
+65 6496 9960
mediasg@argusmedia.com

About Argus Media
Argus is an independent media organisation with more than 700 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.

ARGUS, the ARGUS logo, ARGUS MEDIA, ARGUS DIRECT, ARGUS OPEN MARKETS, AOM, FMB, DEWITT, JIM JORDAN & ASSOCIATES, JJ&A, FUNDALYTICS, METAL-PAGES, METALPRICES.COM, Argus publication titles and Argus index names are trademarks of Argus Media Limited.

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SOURCE Argus Media