(Recasts with statement from Shell)
Dec 17 (Reuters) - Anglo-Dutch oil company Royal Dutch ShellPLC on Thursday called for tougher regulation of theDubai crude benchmark, the Middle East's most importantoil-pricing mechanism, which has pushed up the region's pricesrelative to other grades.
"Regrettably, there have been times in recent months wherethe price of Dubai (crude) was assessed well in excess of thefundamental refining value of other comparable Middle Easterncrudes," Shell said in a statement.
The Dubai benchmark, which is assessed by oil pricing agencyPlatts, is comprised of the three grades of Middle Easterncrude. Two additional grades will be added once proposals underconsideration by Platts are finalized.
Shell argued that Asian crude oil is not subject tooversight as rigorous as benchmarks in other regions, as theonus to ensure a fair market lies with price reporting agenciesrather than regulators.
To level the playing field, Shell is calling for positionlimits and clearing procedures, similar to those in NorthAmerica and Europe.
In August, China's state-owned oil company Chinaoil, thetrading arm of PetroChina Co, snapped up a record 36million barrels of oil, pushing up Middle East crude prices forAsia, even as other grades remained under pressure due to aglobal glut.
"There need to be safeguards to prevent the risk ofdistortion and to ensure the Dubai benchmark price mirrors truemarket supply and demand fundamentals," Shell said.
The volumes bought by Chinaoil and sold by Chinese state oiland petroleum products trader Unipec were so high that pricingagency Platts said in August it was considering whether to allowmore crude into a pool of supplies it uses to assess its dailyAsian benchmark, the Dubai crude price.
However, Platts' global head of oil content Dave Ernsbergersaid that the price-reporting agency is "not responsible forpolicing who buys and sells in the markets", the Financial Timesearlier reported.
Chinaoil and Unipec could not immediately be reached forcomment outside regular business hours.
Platts previously held talks with customers in 2011 over theaddition of Qatar Marine to the Dubai basket due to worriesabout Oman supply disruptions, but nothing was implemented.
Platts, a unit of McGraw Hill Financial Inc,competes with Thomson Reuters in providing news and informationto the energy markets. (Reporting by Ankush Sharma in Bengaluru, additional Reportingby Liz Hampton; editing by Hugh Lawson, G Crosse)
