A bunker fuel and oil report, detailing the day per day trading patterns and prices in the market.The report is prepared from OW Risk Management and covers all major bunker fuel oil markets around the world, including all major ports, ranging from Singapore to Rotterdam.

Market in Brief

Oil prices slid overnight nearly $2/bbl after U.S. economic data reflected weaker oil demand as Europe and the U.S. head into the spring refinery maintenance season. WTI lost $1.88 to settle at $101.45 a bbl while Brent closed $1.54 lower at $107.76 a bbl. A weaker US ISM Non Manufacturing report could strengthen the view of a slowing in the recovery. Crude Oil stocks gained +1,4 mbbl last week and  Distillate inventories, including heating oil and diesel, gained, according to the EIA report, though they were forecasted to shrink. Prices were weighted down further as the crisis in Ukraine retreated from view. Although West’s diplomatic efforts towards Russia suffered setbacks yesterday. Front Brent contract hit $112.39 on Monday, its highest since Dec. 30, but it had settled below the key 200-day moving average of $108.41 on Wednesday the first time in one month. The next important support is around the $105 area. Investors will focus on the European Central Bank decision due later today and closely watched US job report on Friday. This morning Brent is trading +0.3% up while WTI is -0.1% down.

Fueloil Specifics

The NWE bunker fuel oil markets reported increased demand as buyers were eager to fix their stems at lower prices. Delivered 380cst product both in Rotterdam and Antwerp lost nearly $6/mt following weakening Brent values. LSFO markets remain tight and premiums have been varying depending on delivery dates. Singapore bunker fuel oil markets dropped app. $5.5-6.0/mt during Asian Platts window yesterday. Cash premiums flipped back to $0,5/mt after trading at a discount the last couple of days. Suppliers in the area reported average demand and good product avails. Visco spread weakened in the front with spot closing at $3.70/mt yesterday. April is trading at app.$5.75/6.0 while forward prices remain stable trading in a range of $6.5-7.0/mt for the rest of the year. This morning both markets are trading slightly down.

Settlement & Indications (mid values)

Product Yesterday's Values   Forward Indications Product Change Last Dir. Apr May Jun Q314 Q414 Q115 NYMEX WTI Swap (1st month) (1,59) 101,45 ↓ 100,39 99,50 98,54 99,48 96,66 93,75 ICE Brent Swap (1st month) (1,90) 107,76 ↑ 107,23 106,85 106,85 106,90 105,33 104,46 ICE Gasoil Swap (1st month) (21,25) 911,75 ↓ 904,83 902,00 900,67 897,81 891,81 - 3.5% Barges FOB Rtdm (3,25) 573,25 ↓ 574,00 574,00 574,00 573,00 568,75 567,00 3.5% Cargoes FOB Med (2,75) 569,50 ↓ 572,00 571,75 571,50 570,25 566,00 564,00 1.0% Cargoes FOB NWE (3,75) 625,75 ↓ 608,00 604,25 603,25 600,75 593,25 583,75 3% no. 6 USGC WB (1,29) 88,81 ↑ 89,80 89,70 89,85 89,38 88,75 88,45 380 CST Cargoes FOB S'pore (5,75) 596,75 ↓ 595,50 595,50 601,25 594,00 592,00 590,50 0.1 % GO Barges FOB Rtdm (6,25) 911,50 ↓ 906,25 903,25 902,25 899,25 893,25 - Physical Rotterdam 380 CST (6,00) 578,25 ↓ 579,25 579,25 579,25 578,25 574,00 572,25 Physical Singapore 380 CST (6,50) 603,00 ↓ 600,75 600,75 606,50 599,25 597,25 595,75

Focus of the day: Houston

The U.S. bunker market opened the first week of March higher following Crude on concerns about situation in Ukraine. However, the “threat” fell apart and since Tuesday Crude, spot prices, and premiums have been in free fall raising concerns among market participants. New Orleans has been the only location to be able to lock the margin and avoid the losses brought by soft Crude numbers. That’s because the Mississippi river continues its tight avails while few suppliers try to arrange delivery in their congested schedule. On the other hand, Houston was traded at Gulf Coast 3% + $26 Wednesday; a loss of 22 dollars if compared to Monday when Houston was traded at Gulf Coast 3% + $48. The outlook for the second half of the month is more promising with wet suppliers and gaps in schedules allowing some opportunity for prompt business to be done.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual Personal Income Medium 3-Mar 8:30 AM Jan 0.2% 0.0% 0.3% PCE Prices- Core Medium 3-Mar 8:30 AM Jan 0.1% 0.1% 0.1% ISM Index High 3-Mar 10:00 AM Feb 51.0 51.3 53.2 ADP Employment Change Medium 5-Mar 8:15 AM Feb 150K 175K 139K ISM Services High 5-Mar 10:00 AM Feb 53.5 54.0 51.6 Initial Claims Medium 6-Mar 8:30 AM 01-mar 335K 348K - Productivity- Rev. Medium 6-Mar 8:30 AM Q4 2.5% 3.2% - Factory Orders Medium 6-Mar 10:00 AM Jan -0.3% -1.5% - Nonfarm Payrolls High 7-Mar 8:30 AM Feb 165K 113K - Unemployment Rate High 7-Mar 8:30 AM Feb 6.5% 6.6% - Trade Balance Medium 7-Mar 8:30 AM Jan -$37.0B -$38.7B -

Source: OW Risk Management