Platts Considers Adding New Oil Fields To Brent Benchmark Mix

Platts is looking into adding new oil fields to its Brent price assessment to replace declining production from the current mix, which is used to set the cost of crude globally, the energy service's global director for markets and pricing said Monday.

The continuing downward trend in volumes of the four oil blends that make up North Sea benchmark Brent crude will necessitate the addition of new grades in coming years, said Jorge Montepeque, Platts global director, markets and pricing, speaking at the Platts London Oil Forum.

Brent, named for a North Sea oil field, is used as a benchmark to price more than half of the world's oil, and Platts' assessment is used to set the price of expiring Brent futures contracts. Brent's importance to the global oil market has grown in recent weeks, as the New York Mercantile Exchange's oil futures contract, the other leading benchmark, has seen prices held down by a local buildup of supply in the U.S. Midwest.

Platts began adding new blends to its Brent price assessment in 2002, as production from the original Brent field fell to a point where a single company could buy enough cargoes to manipulate prices. The Brent crude benchmark currently comprises a blend of four North Sea crudes: Brent, Forties, Oseberg and Ekofisk.

Platts is considering adding Norwegian Statfjord crude, though longer term the company could include grades from outside the North Sea as reserves deplete further, Montepeque said.

Platts is a unit of The McGraw-Hill Cos. (MHP)

-By Sarah Kent, Dow Jones Newswires; sarah.kent@dowjones.com

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