Mercuria Energy Group has sued SGX-owned Baltic Exchange over alleged losses in the hundreds of millions of dollars tied to distortions in a shipping benchmark for oil tankers. The dispute centers on the cost of shipping oil from the Middle East to China and on TD3C, a rate used as a benchmark across the global oil industry. [1]
The benchmark has historically been based on shipping oil from Saudi Arabia’s Ras Tanura port, which sits inside the Persian Gulf and is reachable only through the Strait of Hormuz. Mercuria says disruption around the near-closure of the strait fed into the benchmark problem and the losses it is claiming. [1]
Sumeet Malhotra said the issue went beyond cargo delays, saying: “It’s not just a case of the physical molecules getting held up. It’s about the cascading effect on the market at large.” He added: “When that happens, there’s no surprise that we’re seeing derivatives disputes and cases against indices.” [1]
The Baltic Exchange traces its history to 1744, making it one of the oldest shipping market institutions in the world. Bloomberg reported on April 30 that Mercuria was suing the exchange. [1]
The case adds a legal challenge for the London-based benchmark provider as the dispute over how oil shipping rates are calculated moves into court. [1]
