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

Friday Crude prices closed the week down more than -$1.5. The July WTI contract settled at $91.97, loosing -$1.64 and Brent at $100.39/bbl,  a hefty -$1.80 lower. Recently the Crude market seems to correlate again with equities following the correction. Oil has been under pressure with general weak fundamentals, a soft demand and ample inventories. As expected OPEC maintained its production quotas at 30 million barrels per day (mbpd) and Saudi Arabia; OPEC largest producer, said they are satisfied with $100/bbl which is largely in line with current market prices. The US economic data saw mixed reports. The April consumer spending data fell -0.2% and so did April personal income. However, the US Chicago PMI reported an increase at 58.7 compared to 49.9 expected and May consumer confidence index rose. This morning, crude is trading mixed with Brent up by 0,2%.

Fueloil Specifics

The Northwest European bunker fuel oil markets closed last week with lower prices and waning demand. Delivered 380cst product in Rotterdam and Antwerp was assessed nearly $8/mt down. Suppliers continuously report tight product avails with up to 4-5 days waiting time for hsfo. Premiums for prompt deliveries were seen at $5-6/mt on Friday. The Singapore fuel oil markets lost app.$1.25 during the Platts window last Friday. Bunker demand was said to be soft and slow while the ample supply was keeping fundamental fragile. The delivered bunker premiums maintained around $6.5 above cargoes prices. This morning both markets are trading slightly higher.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Jun Jul Aug Q313 Q413 2014 NYMEX WTI Swap (1st month) (1,64) 91,97 ↓ 91,98 92,13 92,08 91,96 90,81 88,65 ICE Brent Swap (1st month) (1,80) 100,39 ↑ 100,40 100,14 99,83 99,81 98,89 96,98 ICE Gasoil Swap (1st month) (14,00) 844,75 ↓ 843,17 845,17 847,67 847,44 853,14 846,29 3.5% Barges FOB Rtdm (5,25) 571,00 ↑ 570,25 567,50 565,50 566,50 561,75 554,50 3.5% Cargoes FOB Med (5,00) 564,50 ↑ 564,75 562,50 560,75 561,75 556,00 551,00 1.0% Cargoes FOB NWE (4,50) 595,50 ↑ 598,00 600,25 598,25 598,75 592,75 582,50 3% no. 6 USGC WB (1,34) 88,18 ↑ 89,40 89,15 88,90 88,90 88,15 87,20 380 CST Cargoes FOB S'pore (1,00) 594,75 ↑ 593,25 590,25 588,50 589,25 585,00 578,50 0.1 % GO Barges FOB Rtdm (14,25) 845,00 ↓ 843,25 845,25 848,25 848,25 852,25 845,25 Physical Rotterdam 380 CST (7,00) 576,25 ↑ 575,50 573,25 571,25 571,75 566,00 560,25 Physical Singapore 380 CST (1,00) 602,25 ↑ 600,50 597,00 595,25 595,50 591,25 587,25

Focus of the day: Gibraltar

The three ports of the Gibraltar Strait are running smoothly this morning and enjoy good avails and a fine weather forecast for the coming days, which should support smooth operations. Prompt requirements are still possible for some suppliers in the hub, while others are already fully booked until 5th June. Bunker premiums picked up last Friday after very competitive levels at the end of the month. CIF Med 3.5% is trading 6 usd/mt above Rotterdam FOB Barges and the HILO spread is narrowing to some 30 usd/mt in the Med, with the premium of CIF Med 1% over FOB NWE 1% is currently on 18 usd/mt. The Med market is currently trading slightly higher.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual ISM Index High 3-Jun 10:00 AM May 49.5 50.7 - Construction Spending Medium 3-Jun 10:00 AM Apr 0.5% -1.7% - Trade Balance Medium 4-Jun 8:30 AM Apr -$41.0B -$38.8B - ADP Employment Change Medium 5-Jun 8:15 AM May 140K 119K - Productivity- Rev. Medium 5-Jun 8:30 AM Q1 0.9% 0.7% - Factory Orders Medium 5-Jun 10:00 AM Apr 1.5% -4.9% - ISM Services Medium 5-Jun 10:00 AM May 52.5 53.1 - Initial Claims Medium 6-Jun 8:30 AM 1-June NA 347K - Nonfarm Payrolls High 7-Jun 8:30 AM May 170K 165K - Unemployment Rate High 7-Jun 8:30 AM May 7.5% 7.5% - Consumer Credit Medium 7-Jun 3:00 PM Apr $10.0B $8.0B -

Source: OW Risk Management