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

Despite a weak start crude oil closed quasi unchanged. Market rebounded as news of a better than expected demand at a Spanish bonds auction drove yields slightly lower. Equities and the Euros were in positive territory as well. However, further oil gains were capped as the market seems well supplied especially with Saudi Arabia pumping to record level close to 10 Mios bbl per day. The July WTI contract expired yesterday at $84.03/bbl, up +$0.76 while the next active contract August WTI closed at $84.35. Brent was down -$0.29 at $95.76/bbl. The US Energy department will release its Inventory Report later today and the expectations are as follows: Crude -1.1 mbbl, Distillates +0.8 mbbl, Gasoline +0.8 mbbl. Market is waiting also the outcome of the FOMC meeting and any form of stimulus from the US Federal Reserve. This morning, Brent crude is trading down at $95,42/bbl.

Fueloil Specifics

The Northwest European fuel oil prices closed mixed yesterday. Delivered 380cst product in Rotterdam lost app.$4/mt while cargo prices inched slightly posting app.$1.5/mt gains. ARA region continuously reported tight avails for both HSFO and LSFO. Hamburg and Gothenburg ports on the other hand saw healthy demand on lower prices. The Singapore fuel oil markets fell more than $21.75 during the morning Platts window yesterday as crude softened. The delivered bunker premiums climbed to around $9.5 above cargo prices as sellers were not keen to sell after a big drop in outright prices coupled with a stronger crude movement afterwards. Bunker fuel oil swaps lost nearly $2/mt at the front for Singapore papers and only a few cents for Rotterdam. Backend was stronger for both papers, posting up to $2/mt gains. This morning both markets are trading down.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Jul Aug Sep Q312 Q412 2013 NYMEX WTI Swap (1st month) 0.76 84.03 ↑ 84.52 84.86 85.19 84.86 85.83 85.83 ICE Brent Swap (1st month) (0.29) 95.76 ↓ 95.61 95.72 95.81 95.71 96.01 96.01 ICE Gasoil Swap (1st month) 3.50 845.00 ↑ 844.08 840.67 839.25 841.33 840.42 839.25 3.5% Barges FOB Rtdm 1.50 564.75 ↓ 559.50 554.75 551.00 555.00 546.25 539.25 3.5% Cargoes FOB Med (0.25) 565.00 ↓ 557.00 551.25 547.25 551.75 542.25 535.25 1.0% Cargoes FOB NWE 4.00 657.50 ↓ 592.75 588.75 584.75 588.75 579.50 574.00 3% no. 6 USGC WB (0.08) 88.10 ↓ 87.11 86.58 86.13 85.44 84.83 84.14 380 CST Cargoes FOB S'pore (22.00) 581.75 ↓ 586.75 581.00 576.25 581.25 571.75 563.25 0.1 % GO Barges FOB Rtdm 2.50 846.75 ↑ 844.25 841.25 839.25 842.25 837.25 838.25 Physical Rotterdam 380 CST (4.00) 572.25 ↓ 569.75 565.00 561.25 565.25 556.50 549.50 Physical Singapore 380 CST (19.50) 591.50 ↓ 597.00 591.25 586.50 592.00 582.50 573.25

Focus of the day: Singapore

Singapore's onshore fuel oil stocks have fallen for the second week in a row. They dropped by 148,000 barrels to a three-week low of 19.6 million barrels. Exports from Singapore to China were sharply up, but the draw-down was largely balanced by imports from India and the West. Sources said Western arbitrage arrivals were expected to remain high until the end of this month. Fuel oil arbitrage volumes for the whole June are now predicted to total more than 4 million metric tones. That's similar to May's volumes and slightly higher than initially forecast. July volumes, however, are expected to be lower, with estimates ranging from 2.5 million to 3.5 million mt. Bunker prices plunged in key ports in Asia on Tuesday in line with weaker crude oil prices, according to bunker traders. Singapore's price of benchmark 380cst bunker fuel fell $13 to average at $592.50/mt on Tuesday, data showed. Marine gas oil pegged $2 lower at $837.50/mt on Tuesday. Traders noted that demand was average to below average at the port on Tuesday while avails were fine. Earliest deliveries at the port were from June 24-27 onwards, depending on the supplier.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual NAHB Housing Market Index Medium 18-Jun 10:00 AM Jun 28 29 29 Housing Starts Medium 19-Jun 8:30 AM May 710K 717K 708K Building Permits Medium 19-Jun 8:30 AM May 720K 715K 780K MBA Mortgage Index Medium 20-Jun 7:00 AM 16-Jun NA 18.0% - FOMC Rate Decision Medium 20-Jun 12:30 PM Jun 0.25% 0.25% - Initial Claims Medium 21-Jun 8:30 AM 16-Jun 380K 386K - Existing Home Sales Medium 21-Jun 10:00 AM May 4.50M 4.62M - Philadelphia Fed Medium 21-Jun 10:00 AM Jun -3.5 -5.8 - Leading Indicators Medium 21-Jun 10:00 AM May 0.0% -0.1% -

Source: OW Risk Management