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

Crude prices were trading in wide swings and firmed up on bullish vibes on strong expectation of new stimulus steps to bolster the economy from US FOMC. Markets initially were lifted by OPEC decision to leave its oil production at 30million bbl/day. Prices briefly pared gains following the US inventory report that presented a more bearish outlook with massive builds of +3.0 mbbl and +5.0 mbbl for distillates and gasoline inventories respectively. Late in the afternoon market was pre-positioning ahead of the US Federal Chairman announcement after the FOMC meeting expecting some level of monetary easing and possible interest rate cut. However, the announcement did suggest fresh bond buying program but declined to cut interest rate further until the US unemployment was more under control. Mr. Bernanke warned about the currently ongoing unresolved discussion on the treatment of the US fiscal cliffs posing major implication to current and future economic growth. It dampened initial market expectations and gains were pared. The January WTI futures closed at $86.77/bbl, up $0.98 while Brent settled at $109.50/bbl, up $1.49. This morning, crude prices are trading down.

Fueloil Specifics

The Northwest European fuel oil markets reported firming trading activity following higher prices. Delivered 380cst product in Rotterdam was assessed app.$2/mt up while cargo prices gained more than $6/mt compared to previous day’s close. Rotterdam port continuously struggles with prompt product deliveries due to operational delays at loading installations. Some suppliers said to be fully booked until the end of this week. The Singapore markets were up again, more than $2.5 during the morning Platts window tracking higher crude values. Delivered bunker premiums were inched up to $5.0- 6.0 above cargo prices yesterday as crude strengthened after the window. Bunker fuel oil swaps gained app.$6.5/mt at the front of the forward curve both for Rotterdam and Singapore papers. Backend was app. $2/mt stronger. This morning both markets are trading slightly lower.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Jan Feb Mar Q113 Q213 2013 NYMEX WTI Swap (1st month) 0.98 86.77 ↓ 86.99 87.57 88.17 87.57 89.05 88.99 ICE Brent Swap (1st month) 1.49 109.50 ↓ 107.12 106.35 105.74 106.40 104.87 104.25 ICE Gasoil Swap (1st month) - 923.00 ↓ 921.25 920.17 918.00 919.81 913.25 910.65 3.5% Barges FOB Rtdm 6.50 573.75 ↓ 579.25 582.00 583.75 581.75 584.75 583.75 3.5% Cargoes FOB Med 3.00 565.50 ↓ 572.50 575.75 578.00 575.50 579.50 578.75 1.0% Cargoes FOB NWE 5.25 596.25 ↓ 606.75 610.25 611.75 609.75 613.25 612.00 3% no. 6 USGC WB 1.34 93.04 ↓ 92.20 91.80 91.65 91.88 91.52 91.40 380 CST Cargoes FOB S'pore 3.25 600.50 ↓ 602.75 605.50 607.50 605.25 609.25 608.00 0.1 % GO Barges FOB Rtdm 15.75 919.25 ↓ 921.25 920.25 919.25 921.25 913.25 911.25 Physical Rotterdam 380 CST 2.00 579.25 ↓ 589.50 592.25 594.00 592.00 595.00 594.00 Physical Singapore 380 CST 4.00 606.25 ↓ 612.50 615.25 617.25 615.50 619.50 618.75

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual Trade Balance Medium 11-Dec 8:30 AM Oct -$43.0B -$41.5B -$42.2B Wholesale Inventories Medium 11-Dec 10:00 AM Oct 0.3% 1.1% 0.6% MBA Mortgage Index Medium 12-Dec 7:00 AM 08-Dec NA 4.5% 6.2% FOMC Rate Decision High 12-Dec 12:30 PM Dec 0.25% 0.25% 0.25% Treasury Budget Medium 12-Dec 2:00 PM Nov -$113.0B -$137.3B $172.1B Initial Claims Medium 13-Dec 8:30 AM 08-Dec 375K 370K - Retail Sales High 13-Dec 8:30 AM Nov 0.6% -0.3% - Core PPI Medium 13-Dec 8:30 AM Nov 0.1% -0.2% - Business Inventories Medium 13-Dec 10:00 AM Oct 0.3% 0.7% - Core CPI High 14-Dec 8:30 AM Nov 0.1% 0.2% - Industrial Production High 14-Dec 9:15 AM Nov 0.5% -0.4% - Capacity Utilization Medium 14-Dec 9:15 AM Nov 78.0% 77.8% -

Source: OW Risk Management