OPIS Company News & Press Room

Airline Fuel Buyers Find New Way to Purchase Barrels

Gaithersburg, MD, February 18, 2016 – Fuel acquisition managers for top European airlines now have a new way to purchase fuel and assess all-day fuel values using the exclusive OPIS450 trading screen and platform.

In fact, the first barge deal occurred today between Lufthansa and Vitol using the OPIS450 trading screen, designed to create a new way to assess aviation fuel prices in Europe and to allow buyers and sellers to execute actual transactions.

Just before 4pm London time, on Thursday February 18th, Lufthansa sold 2,000 metric tons of jet fuel to Vitol, loading Feb. 23-27 from Rotterdam via OPIS450.

OPIS450 is an innovative tool that calculates the average price of jet barges in the ports of Flushing, Amsterdam, Rotterdam, Antwerp, and Ghent at every minute of the day between 9am and 4.30pm London time – some 450 minutes.

Live bids, offers and trades are fed through to OPIS through a trading screen from Trayport, a technology company which is owned by the Intercontinental Exchange.

The effect of the OPIS450 is to capture peaks and valleys of oil volatility throughout the day, rather than just a single price at 4.30pm London time when the Low Sulfur Gasoil futures settle.

OPIS450 takes into account OPIS’s well-known full-day pricing methodology while offering complete market transparency for anyone wanting to price fuel.

The combination of the new OPIS Europe Jet Ticker and OPIS450 makes jet fuel prices visible through the entire trading day. By using price averages OPIS450 helps navigate through the spikes and troughs that are characteristic of volatile market trading.

Lufthansa first offered the jet barge at $14/metric ton above the March Low Sulfur Gasoil future. Ultimately Lufthansa struck a deal with Vitol via OPIS450 at a differential of $12.25/ton.

There was another offer on the Trayport screen at $14/ton above the March Low Sulfur Gasoil future as well from a different company.

Under the OPIS450 methodology, the next day market will start at the same differential of $12.25/ton, and change as new deals are struck.

The differential value will only move if there is a higher bid or lower offer than $12.25/ton, or a fresh trade.

BP was also heard bidding in the market today at March Low Sulfur Gasoil plus $16/ton for jet barges in the ports around the Rotterdam trading hub, but for later loading dates of Feb. 29 to March. 4.

The OPIS450 only assesses prompt loading jet barges.

Learn more about the OPIS Europe Jet Ticker and the underlying OPIS450 methodology here.

Tim Wright
Director, Business Development and Content
OPIS | Oil Price Information Service