One of the most dominant conversation topics in the crude world over the last several years has been the declining production profile in the North Sea region.

North Sea grades—and particularly the light, sweet, distillate-rich crudes that have dominated regional production historically—have formed the backbone of the Dated Brent assessment.

However, as the region has matured, production has begun to decline.

This has happened more slowly perhaps than expected, particularly given the low price environment that has hampered regional investment for the last three years or so.

While a lot of the market chatter around this has quite reasonably centered on the possible impact this will have on the basket that makes up Dated Brent, it’s important to note these declines have not been limited to Brent, Forties, Oseberg and Ekofisk (BFOE), but have been consistent across the North Sea region.

Furthermore, most of the newer discoveries in the North Sea over the last decade have differed from the “light, sweet” style that has been synonymous with the region.

The newer grades are overwhelmingly more heavy, more sour and—perhaps most importantly—more acidic than the classic BFOE grades. Over the years, a number of regional grades, current and future, have been suggested—both by S&P Global Platts and by the market—as possible additions to BFOE moving forward.

Platts has always taken the view that the best solution moving forward to liquidity in the FOB Dated Brent market should lie within the North Sea region. This position is shared by much of the market at large.

It’s become increasingly clear that there is no perfect solution, but there are a number of possible solutions that can be adapted moving forward.

When looking at what grades should be included in the Dated Brent basket, Platts looks at a number of different factors including: a diversity of buyers and destinations; stable grade quality; a steady and reliable production rate; that a given grade is not subject to undue political influence; and that it contains a long-term, stable production profile.

Considering Norway’s Troll for the Brent basket

Consequently, Platts has started looking more closely at the role that Norway’s Troll can play in BFOE moving forward. Troll is a light, sweet distillate-rich crude grade with a healthy production profile of 240,000 b/d that, coincidentally, prices quite neatly into...