Gaming Oil Price Benchmarks
There has got to be a better way to benchmark oil spot prices…
Key to the strategy is a peculiar aspect of the spot market for oil, where traders buy and sell bargeloads for immediate delivery. Deals are negotiated in private, and buyers and sellers aren’t required to disclose prices to anyone. To come up with a benchmark price, Platts has to rely on information volunteered by traders—a far cry from the way stocks or even oil futures are priced by crunching comprehensive data from public exchanges.