The move is expected to offer traders more flexibility in loading cargoes and improve market liquidity, traders said.

Apart from landed storage tanks in Singapore, Platts currently recognises loadings from Pasir Gudang, Tanjung Langsat, Tanjung Bin and certain floating storage units in nearby waters for its Singapore price assessment process.

And while Singapore is Asia’s largest oil trading hub, a scarcity of land has hit growth of the business there. This has spurred billions of dollars of investment on the construction of storage facilities in neighbouring Malaysia and Indonesia.

Following positive feedback from the industry to the proposal that Pengerang deliveries be included in the assessments for middle distillates and gasoline, it will go ahead with the move effective May 1, Platts, a unit of McGraw Hill Financial Inc., said in a note to its subscribers.

Platts, which provides Asian benchmark assessments for most oil products traded in the region, is also planning to change the loading points in its pricing assessments for fuel oil, gasoil, jet fuel and gasoline from July 1.

Platts said it will introduce a free-on-board (FOB) Straits benchmark to replace the existing FOB Singapore benchmark. In the new benchmark, traders will not have to specify a loading port at the time of placing a bid or offer and can include cargoes to be loaded from approved terminals in either Singapore or southern Malaysia.

The Pengerang terminal, majority owned by a 51-49 joint venture of Dialog and Dutch oil and chemicals storage company Vopak, started operations last year.

The facility is in the process of being filled but is not yet at full capacity, said a source with Vopak, declining to be named because he wasn’t cleared to speak with the press.

“With the Platts approval, we expect interest to pick up,” he said.

The Pengerang site is able to accommodate very large crude carriers (VLCCs) and will have an initial storage capacity of about 1.3 million cubic meters, according to Vopak’s website.

The terminal is one of several upcoming energy projects in Pengerang, including a refinery and petrochemical integrated development by Malaysia’s Petronas, although some of these may be delayed by the 50 percent slump in oil prices since June of last year.