The Tokyo Commodity Exchange on Tuesday signed a memorandum of understanding with S&P Global Platts that includes cooperation in developing LNG market in Asia.
Following the deal with the Singapore Exchange, TOCOM tied with Platts to develop active markets and benchmark prices for Japanese domestic oil refined products and LNG in Asia.
The two companies will work together to accelerate the development of derivatives products based on such prices with the aim of enhancing risk management and market transparency for the benefit of all market participants.
Speaking of the agreement, Takamichi Hamada, president and CEO of TOCOM, said that for LNG in particular the cooperation with Platts would lead to the “creation of a proper price discovery mechanism” by “adding spot trading functions.”
As Japan is looking to move into a more liberal energy market, Platts is looking to launch new price assessments that meet the specific needs of the Japanese market, according to Martin Fraenkel, Platts president.