SINGAPORE - Energy trading heavyweight Morgan Stanley (MS.N: Quote, Profile, Research, Stock Buzz) withdrew from a half-hour oil trading window in Asia on Thursday after price benchmarking agency Platts placed it under review because of counter-party concerns about its credit status, two industry sources said on Thursday.
The Platts review does not stop Morgan Stanley trading oil, but means that its bids and offers will not be taken into account during the daily half-hour "window" during which Platts assesses prices in over-the-counter oil markets.
Rather than risk a possible public test of its credit acceptance among counterparties in an increasingly anxious oil market, Morgan Stanley asked its brokers in Singapore not to put prices into the Platts system, three brokers with different companies told Reuters.
But Morgan Stanley, one of the two biggest oil derivatives traders, continued to participate in over-the-counter markets through the day and there was no suggestion that it was withdrawing from OTC trade.
A spokesman for Morgan Stanley in London declined comment.
Platts also declined to comment.
But Jorge Montepeque, Platts' global director of market reporting, told a conference in London on Thursday: "Counterparty acceptance is a huge problem right now in commodity markets too... We have situations where entities in the oil industry will not trade with a bank."
Being blocked from the window will reduce the bank's influence on Platts prices, the benchmark for physical OTC trade across world oil markets.
The Platts review does not stop Morgan Stanley trading oil, but means that its bids and offers will not be taken into account during the daily half-hour "window" during which Platts assesses prices in over-the-counter oil markets.
Rather than risk a possible public test of its credit acceptance among counterparties in an increasingly anxious oil market, Morgan Stanley asked its brokers in Singapore not to put prices into the Platts system, three brokers with different companies told Reuters.
But Morgan Stanley, one of the two biggest oil derivatives traders, continued to participate in over-the-counter markets through the day and there was no suggestion that it was withdrawing from OTC trade.
A spokesman for Morgan Stanley in London declined comment.
Platts also declined to comment.
But Jorge Montepeque, Platts' global director of market reporting, told a conference in London on Thursday: "Counterparty acceptance is a huge problem right now in commodity markets too... We have situations where entities in the oil industry will not trade with a bank."
Being blocked from the window will reduce the bank's influence on Platts prices, the benchmark for physical OTC trade across world oil markets.
