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 rallied strongly yesterday. The February WTI contract settled at $95.49/bbl, up +$1.25 and Brent at $111.10/bbl, up $1.42. Crude prices were higher due to positive US macroeconomic data: the US weekly jobless claims reported a drop (-36K) compared to market forecast and the US December Housing Starts hit a four and a half-year high. US stocks set also a five –year high. Republicans have suggested they may press for only a short term increase in the debt ceiling. The China 4th quarter GDP grew by +7.9% vs 3rd quarter at +7.4% rebounding from 7 straight quarters of slowdown. On the other hand, the 2012 Chinese GDP came out at +7.8%, the slowest growth since 1999. The Chinese oil demand was up 8.4% in December and 4.5% for the whole year 2012, a lesser figure compared to 2011 at +6.3%. The IEA raised its forecast for global oil demand this year, up 250k bbb/d. Worlds consumption will increase 900k bbl/d (+1%) this year to average 90,8 mios. This morning, crude is trading slightly lower.

Fueloil Specifics

The Northwest European bunker fuel oil prices closed Thursday with no changes. Demand in the area remained subdued as buyers were awaiting some guidance in the market. Rotterdam port continuously reported delays at loading installations, tight lsfo and prompt hsfo avails. The Singapore fuel oil market prices rebounded from previous day loss by $3.0-4.0 during the morning Platts window yesterday. The latest Singapore Heavy Residual inventory reported a build of +0.65 mbbl to 18.43 mbbl. The delivered bunker premiums were seen at $3.5- 5.0 above cargo prices as crude strengthened in latter sessions. This morning both markets are trading higher.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Feb Mar Apr Q213 Q313 Q413 NYMEX WTI Swap (1st month) 1,25 95,49 ↓ 95,94 96,28 96,52 96,60 96,15 95,17 ICE Brent Swap (1st month) 1,42 111,10 ↓ 110,51 109,74 109,13 108,51 106,78 106,78 ICE Gasoil Swap (1st month) 6,50 952,50 ↑ 951,83 944,33 937,25 931,97 922,31 915,22 3.5% Barges FOB Rtdm 3,00 606,50 ↑ 610,25 608,50 607,25 605,75 601,25 596,75 3.5% Cargoes FOB Med 3,50 606,25 ↑ 605,50 604,25 603,25 602,00 597,25 592,75 1.0% Cargoes FOB NWE 4,00 635,50 ↑ 644,25 642,50 641,50 640,25 635,00 627,50 3% no. 6 USGC WB 1,30 96,28 ↓ 96,10 95,85 95,60 95,10 94,35 93,35 380 CST Cargoes FOB S'pore 3,00 625,25 ↑ 634,50 633,25 632,00 630,00 625,75 621,50 0.1 % GO Barges FOB Rtdm (0,75) 953,50 ↑ 952,25 945,25 937,25 933,25 921,25 915,25 Physical Rotterdam 380 CST 0,00 611,00 ↑ 617,50 615,75 614,50 613,00 608,50 604,00 Physical Singapore 380 CST 3,50 630,50 ↑ 641,75 640,50 639,25 637,25 633,00 628,75

Focus of the day: Piraeus

Piraeus was fairly busy this week. Crude market was not very volatile and average CIF MED 3.5% was only $ 2.45 lower than the previous week. Product availability in Piraeus was very good and despite some tightness in LSFO 380, all grades can be quoted for, even for prompt supplies. The major problem in the Mediterranean this week was the rough weather. Very strong southbound winds have been blowing during the last couple of days, creating a swell that made supplies by barge at the anchorages very difficult to effect. Piraeus was affected as well and although supplies were not suspended, conditions were very difficult. Weather is expected to improve this afternoon.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual Retail Sales High 15-jan 8:30 AM Dec 0.4% 0.3% 0.5% Core PPI High 15-jan 8:30 AM Dec 0.1% 0.1% 0.3% Empire Manufacturing Medium 15-jan 8:30 AM Jan 0.0 -8.1 -7.8 MBA Mortgage Index Medium 16-jan 7:00 AM 12-jan NA 11.7% 15.2% Core CPI High 16-jan 8:30 AM Dec 0.1% 0.1% 0.1% Industrial Production Medium 16-jan 9:15 AM Dec 0.1% 1.1% 0.3% Initial Claims Medium 17-jan 8:30 AM 12-jan 375K 371K 335K Housing Starts Medium 17-jan 8:30 AM Dec 880K 861K 954K Building Permits Medium 17-jan 8:30 AM Dec 880K 899K 903K Philadelphia Fed Medium 17-jan 10:00 AM Jan 1.0 4.6 -5.8 Mich Sentiment High 18-jan 9:55 AM Jan 76.0 72.9 -

Source: OW Risk Management