SGX backs Baltic Exchange in Mercuria lawsuit over crude tanker index

The Swiss trader alleges “hundreds of millions” in losses from the TD3C benchmark.

Singapore Exchange (SGX) rejected allegations by Mercuria Energy Trading S.A. that its subsidiary, Baltic Exchange Information Services Limited, failed to meet its obligations in producing the TD3C benchmark.

The Baltic produces its benchmarks under established governance frameworks, methodologies, and oversight processes, SGX said in an announcement on 3 May.

In a separate statement on 2 May, the London-based exchange said it was confident in its processes, believes the claim from Mercuria to be without merit, and will defend it to the fullest extent.

“Whilst we await the full details of the claim, Mercuria is seeking declaratory relief from the English High Court to compel the Baltic to deviate from these processes,” the Baltic added.

The dispute stems from a lawsuit filed by Swiss-based Mercuria in the English High Court on 30 April, according to a Reuters report.

The trader alleged that the exchange continued publishing the TD3C crude tanker index despite what it described as the “effective closure” of the Strait of Hormuz amid ongoing conflict in the Gulf.

Reuters said the TD3C route is based on voyages from the Gulf to China.

Mercuria, a subscriber to Baltic Exchange data, said the continued publication of the benchmark breached contractual and statutory duties.

It added that this resulted in losses on both physical freight contracts and freight derivatives linked to TD3C, with damages currently estimated in the “hundreds of millions of US dollars.”

The Baltic Exchange, acquired by SGX in 2016, is an independent source of maritime market information for the trading and settlement of physical and derivative contracts.