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 higher during the yesterday trading session in anticipation of positive hints from the testimony by US Fed Chairman to Congress. The EUR/USD rate was somehow supportive to energy contrasts as the market expected signals of some form of quantitative easing. Markets remained volatile due to some difference in interpretation of the Fed’s comments by the market participants. As a result of the day the August WTI futures settled at $89.22/bbl, up by $0.79 while the September Brent contracts were up by $0.63 to close at $104.00/bbl. Although there was no direct reference to any stimulus policies, the US Fed is investigating possibilities to boost the economy should the US labour market fail to improve. This approach had actually supported the market while the economic data reported yesterday was not quite impressive. Today we will see a release of the weekly US Energy department inventory report and the expected numbers are as follows: crude -1.2 mbbl, distillates +1.5 mbbl, gasoline +1.2 mbbl. This morning, crude is trading down.

Fueloil Specifics

NWE bunker fuel prices were assessed higher again yesterday. Cargo prices were up by approx. $4/mt. 380cst bunker fuel gained twice as much. This resulted in a spread between them coming back to approx. $10/mt. The Singapore fuel oil market prices were assessed up by more than $13.0/mt during the local Platts window. The Asian Fuel Oil crack weakened, lagging the strength in crude values. The delivered bunker premiums softened to around $7.25/mt above cargo prices yesterday as demand remained soft on high outright prices. Front month bunker fuel swaps were up by approx. $4.5/mt in Rotterdam while 2013 papers gained half as much. Singapore 180 cst Cargo FOB papers were slightly softer having gained a dollar in the front while loosing a little at the backend of the curve. Despite this little relative weakness if the Asian prices both markets added a little to the backwardation discount of the forward curve. Both markets are trading slightly down this morning.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Aug Sep Oct Q412 Q113 2013 NYMEX WTI Swap (1st month) 0.79 89.22 ↓ 89.32 89.66 90.04 90.51 91.40 90.51 ICE Brent Swap (1st month) 0.45 104.00 ↓ 103.26 102.76 102.45 102.18 101.41 102.18 ICE Gasoil Swap (1st month) 5.00 894.50 ↓ 896.00 894.00 892.42 888.97 851.50 877.67 3.5% Barges FOB Rtdm 3.75 593.75 ↑ 591.25 588.00 585.50 583.50 579.00 572.50 3.5% Cargoes FOB Med 4.50 592.00 ↑ 587.75 583.75 581.25 579.25 574.75 568.50 1.0% Cargoes FOB NWE 5.25 639.00 ↑ 633.25 627.50 622.75 619.00 611.50 605.25 3% no. 6 USGC WB 0.45 93.00 ↓ 91.20 90.80 90.40 89.60 89.05 88.78 380 CST Cargoes FOB S'pore 13.50 617.00 ↑ 611.75 620.75 608.00 602.50 597.50 592.75 0.1 % GO Barges FOB Rtdm 5.50 892.75 ↓ 897.25 896.25 894.25 891.25 881.25 880.25 Physical Rotterdam 380 CST 8.00 603.75 ↑ 601.50 598.25 595.75 593.75 589.25 582.75 Physical Singapore 380 CST 12.50 623.75 ↑ 622.00 631.00 618.25 613.25 608.25 603.50

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual Retail Sales High 16-Jul 8:30 AM June 0.2% -0.2% -0.5% Business Inventories Medium 16-Jul 10:00 AM May 0.2% 0.2% -0.4% CPI High 17-Jul 8:30 AM June 0.1% -0.3% 0.0% Industrial Production High 17-Jul 9:15 AM June 0.3% -0.1% 0.4% Housing Strats High 18-Jul 8:30 AM June 743K 708K - Initial Claims Medium 19-Jul 8:30 AM 14-Jul 365K 350K - Existing Home Sales Medium 19-Jul 10:00 AM June 4.65M 4.55M - Leading Indicators Low 19-Jul 10:00 AM June -0.2% 0.3% -

Technical indicators

Daily Charts Resistance Brent WTI GO Near 104.75 89.45 902.50 Next 105.50 90.20 903.85 Strong 108.80 92.70 908.95 Support Brent WTI GO Near 102.95 87.95 893.20 Next 102.25 86.95 886.85 Strong 101.65 85.40 882.20       All three contracts we watch gained again yesterday supporting our positive view. We remain positive and expect the contracts to climb towards the targets higher. This view will remain valid until we see a slid below s/t MAs or signs of the overbought conditions given by oscillators. The targets on all charts remain around 38.2% Fibo of the March – June move down. The EUR/USD has improved a bit again though it did not create any threat to the resistance @ 1.2351, which we hoped to see. This would be quite a positive change at the EUR/USD chart.

Source: OW Risk Management