Why are Cross Atlantic indicators needed?
The surge in US oil shale production and subsequent growth in crude and product exports has caused structural changes in Atlantic trade flows. At the same time, Europe’s demand profile has changed, with a switch away from gasoline despite gasoline production remaining steady.
As a result, the Atlantic basin, always a key trading area, has become a bellwether of global trade - albeit one that is under-served in terms of price discovery, which remains very much focussed on one side of the Atlantic or the other. By looking at the Atlantic basin as a whole, we can provide robust and stable indicators that reflect a greater volume than an individual region and are also time normalized on both sides of the Atlantic.
The CAX crude and product indexes are blends of European and American benchmarks that reflect the fluid nature of trade. The CAX benchmark series recombine widely recognised indicators including Brent, WTI and products futures with physical benchmarks such as European gasoline across both sides of the Atlantic and therefore provides a genuinely complete view of market conditions in the basin.
All Cross Atlantics are expressed in dollars per barrel. Products are also databased in dollars per tonne and cents per gallon.
Cross Atlantic Crude (CAXC)
The Cross Atlantic Crude benchmark comprises Brent and WTI, with the relevant futures contracts providing the value underpinning the CAXC index. It supports the Global Crude Index by providing a regular snapshot of the trading dynamics between Europe and North America.
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Cross Atlantic Gasoline (CAXG)
The Cross Atlantic Gasoline benchmark comprises New York Harbor gasoline and North West European gasoline. This Index is a transactable benchmark representing the tradeable value of the underlying futures contract and one physical gasoline contract as calculated by General Index.
Cross Atlantic Diesel (CAXD)
The Cross Atlantic Diesel benchmark comprises New York Harbor ULSD and European ULSD. The Cross Atlantic Diesel Index is a transactable benchmark representing the tradeable values of the underlying futures contracts.