Platts: No Evidence To Suggest Bunker Prices are Manipulated

Platts say it looked at looked at all indications posted by Rixo from 2006 up to the present day.

In response to claims that traders have been able to manipulate benchmark prices for bunkers and fuel oil on the spot market, Platts say that after a comprehensive review it has found no evidence of anomalous behaviour, and that the integrity of its Market on Close (MOC) assessment process has not been compromised.

Ship & Bunker reported last month that in an interview with the Wall Street Journal, Halis Bektas, head of the Swiss firm Rixo International Trading Ltd. claimed he had forced Platts assessments lower than market value by selling a small amount of oil at a loss, and then profited by buying large volumes at the lower price.

Platts said in light of the claims, it conducted a review that looked at all indications posted by Rixo in the Platts MOC from 2006 up to the present day.

Med HSFO Market

Focussing on the high-sulfur fuel oil market in the Mediterranean, the main market for Rixo's trading activity, Platts said Rixo publicly bid fuel oil cargoes 124 times, offered 19 times, and traded a total of 23 cargoes.

Any bids and offers submitted to Platts for publication in the MOC process that are out of line with prevailing market value are discarded from the price discovery process.

Platts said that during the review period, there was one occasion when a Rixo offer appeared to be below market value and it was immediately eliminated from the assessment process.

For Rixo's other bids and offers, Platts said that by comparing the spreads between the Med HSFO market, where Rixo provided information, against related markets where it did not, any improperly affected assessments when Rixo provided data for consideration would stand out as a notable spike in the differential between the two markets.

No such spike was found, and any days when a Rixo bid or offer contributed to a change in published value, the change was inline with overall market movements.

In addition, Platts said it identified a specific set of offers from Rixo that supported the fact that a trader can not sell below market rate, or by the same logic, bid too high.

As part of the review Platts also contacted Bektas for further clarification of the claims, however Platts said he stated that his comments had been misrepresented in the article and therefore declined to provide any more specific information about his transactions.

With no evidence of anomalous behaviour, Platts concluded that the integrity of the Market on Close assessment process was not compromised.

A Platts Global Alert has been issued detailing the investigation process in full.