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.
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Crude Oil closed lower yesterday erasing the previous gain. The August WTI future closed at $84.19/bbl, down -$2.08 and Brent contract fell -$2.35 to settle at $97.97/bbl. Market came off after the oil strike in Norway was stopped and full production will be reached as early as next week. US equities were down and so was Euro setting a new low at 1,2235 against dollar which pressured Crude Oil..The US Department of Energy, in its Short Term outlook, lowered its demand forecast and crude prices projection . US Inventory report compiled by API showed massive crude build surge above expectation which could be due to delay in logistic because of the previous Tropical Storm Debby. The more widely watched US Energy Department inventory report will be released later today and their expectations are as follows: Crude -1.2 mbbl, Distillates +0.4 mbbl, Gas +0.3 mbbl. In terms of Economic data, the US Trade balance, wholesale Inventories and Minutes of FOMC meeting are scheduled today.This morning, crude is trading +1%.
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Bunker fuel prices had lost few dollars yesterday. Cargo prices were down by approx. $2/mt in Rotterdam. Delivered 380cst product lost a dollar more as ARA port hub enjoys a healthy supply from Russia while demand remains soft and arbitrage to other markets is largely closed. Mediterranean market is well supplied as well, though spot prices remained strong compared to the North of Europe. LS grades remain tight, esp. in the ARA area supported by the ECA regulation coming in force from August 1. However, the supply of the LS grade is expected to increase through the rest of July. The Singapore fuel oil markets prices came off by more than $2.0/mt during the Platts window. Market saw more selling interest which resulted in weakened Asian Fuel Oil cracks. The delivered bunker premiums were at approx.. $7.75/mt above cargo prices yesterday. Bunker fuel swaps lost approx. $1.00 - 1.25/mt both for Rotterdam and Singapore papers shifting the whole forward curve slightly lower. Singapore papers were marginally stronger compared to Barges. Both markets are trading slightly lower this morning.
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Settlement & Indications (mid values)
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Product
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Yesterday's Values
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Forward Indications
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Product
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Change
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Last
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Dir.
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Aug
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Sep
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Oct
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Q412
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Q113
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2013
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NYMEX WTI Swap (1st month)
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(2.08)
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83.91
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↑
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85.41
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85.79
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86.31
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86.71
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87.76
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86.71
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ICE Brent Swap (1st month)
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(2.35)
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97.97
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↑
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98.25
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97.98
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97.84
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97.71
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97.31
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97.71
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ICE Gasoil Swap (1st month)
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1.75
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875.50
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↓
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866.92
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863.17
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859.83
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857.22
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851.50
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847.75
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3.5% Barges FOB Rtdm
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(2.25)
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567.50
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↓
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562.25
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559.25
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557.00
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555.25
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551.50
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546.75
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3.5% Cargoes FOB Med
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0.50
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568.75
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↓
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558.50
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555.25
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553.00
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551.00
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547.25
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542.50
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1.0% Cargoes FOB NWE
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1.00
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612.25
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↓
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602.25
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597.25
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592.75
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590.25
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584.50
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579.50
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3% no. 6 USGC WB
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(0.85)
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86.70
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↑
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87.25
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86.95
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86.70
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86.10
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85.70
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85.52
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380 CST Cargoes FOB S'pore
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(2.50)
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590.00
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↓
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587.25
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584.50
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582.75
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580.25
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575.75
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570.50
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0.1 % GO Barges FOB Rtdm
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2.00
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873.75
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↓
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867.25
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864.25
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860.25
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860.25
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851.25
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849.25
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Physical Rotterdam 380 CST
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(3.00)
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575.25
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↓
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572.50
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569.50
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567.25
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565.50
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561.75
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557.00
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Physical Singapore 380 CST
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(2.00)
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597.00
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↓
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597.50
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594.75
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593.00
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591.00
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586.50
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581.25
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Economy fundamentals this week
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Fundamental Indicators
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Statistic
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Importance
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Date
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Time
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Period
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Consensus
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Last
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Actual
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Consumer Credit
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Low
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09-Jul
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3:00 PM
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May
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$9.5B
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$6.5B
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$17.1B
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Trade Balance
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Medium
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11-Jul
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8:30 AM
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May
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-$48.9B
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-$50.1B
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-
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Wholesale Inventories
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Low
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11-Jul
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10:00 AM
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May
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0.3%
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0.6%
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-
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FOMC Minutes
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Medium
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11-Jul
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2:00 PM
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20-Jun
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-
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-
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-
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Initial Claims
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Medium
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12-Jul
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8:30 AM
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07-Jul
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375K
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374K
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-
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Export Prices
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Medium
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12-Jul
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8:30 AM
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June
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NA
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-0.5%
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-
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Treasury Budget
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Medium
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12-Jul
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2:00 PM
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June
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NA
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-$43.1B
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-
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PPI
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High
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13-Jul
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8:30 AM
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June
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-0.6%
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-1.0%
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-
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Daily Charts
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Resistance
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Brent
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WTI
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GO
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Near
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99.20
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85.40
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876.50
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Next
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100.70
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86.05
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889.70
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Strong
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104.10
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87.75
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895.35
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Support
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Brent
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WTI
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GO
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Near
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98.30
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84.50
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861.95
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Next
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97.80
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84.30
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857.00
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Strong
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96.15
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83.20
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849.25
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Technical picture remains largely unchanged from yesterday. Both crudes tested levels below the nearby support trading within the recent range and the close was note quite impressive. They look slightly better this morning though. GO was slightly stronger having poster a small intraday gain. Technical view remains unchanged: we expect further tests of the supports prior to the next move towards the nearby resistance levels. MA34s remain important esp. on crude charts and shall be watched as a convincing violation would change the view to more neutral. Any support from EUR/USD would be helpful as well. The currencies remain quite grim. However, we note a forming RSI divergence on the EUR/USD chart.
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Source: OW Risk Management