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 after hovering in the same price zone, finally settled higher yesterday. The February WTI closed at $94.24/bbl, up +$0.96 and Brent expired at $110.61/bbl, up +$0.31. The next front month contract, March Brent settled at $109.68/bbl. Crude prices were supported by a surprise draw in crude stockpile; -1.0 mbbl against an expected +2.3 mbbl. The product inventory namely; distillates and gasoline saw larger builds than expected which do reflect the current sluggish demand. The Cushing stockpile saw a record build of 51.86mbbl as the Seaway pipeline is expected to start pumping crude down to the South from the Midwest, bringing down the supply glut. The US weekly jobless claims and the US December housing starts data will be release later today to provide some price guidance. This morning, crude is trading slightly higher.

Fueloil Specifics

The NWE bunker fuel oil markets one more day closed only with marginal changes. Delivered 380cst product in Rotterdam gained app.$1/mt while cargo prices closed a few cents down. Demand levels remained on the low side with Rotterdam port continuously reporting tight avails both for HSFO and LSFO products. The Singapore fuel oil market prices fell app. $8.0 during the morning Platts window yesterday. There were no significant changes to the fundamentals. The delivered bunker premium remained at around $4.5 above cargo prices. 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) 0,96 94,24 ↑ 94,91 95,23 95,50 95,62 95,26 94,47 ICE Brent Swap (1st month) - 109,68 ↑ 109,60 108,95 108,40 107,80 106,06 106,06 ICE Gasoil Swap (1st month) (5,75) 955,00 ↓ 947,58 940,17 933,08 928,39 916,83 910,22 3.5% Barges FOB Rtdm (0,25) 603,75 ↑ 604,25 602,50 601,00 599,75 595,50 591,00 3.5% Cargoes FOB Med 0,25 602,00 ↑ 599,50 598,50 597,50 595,50 591,50 587,00 1.0% Cargoes FOB NWE (1,00) 632,25 ↑ 638,25 636,50 635,00 633,75 628,75 621,25 3% no. 6 USGC WB 0,52 94,49 ↑ 94,95 94,95 94,45 93,95 93,20 92,45 380 CST Cargoes FOB S'pore (8,00) 622,25 ↑ 628,75 627,25 626,00 624,25 620,00 616,00 0.1 % GO Barges FOB Rtdm (6,75) 954,25 ↓ 948,25 941,25 933,25 929,25 916,25 910,25 Physical Rotterdam 380 CST 1,00 611,00 ↑ 611,50 609,75 608,25 607,00 602,75 598,25 Physical Singapore 380 CST (8,00) 628,00 ↑ 636,00 634,50 633,25 631,50 627,25 623,25

Focus of the day: Houston

There is very tight avails in NOLA, something that together with the bad weather (operations issues) are currently resulting in higher New Orleans bunker prices. With some suppliers out of product, others with limited barge availability and increased demand as traffic moved in from the Mississippi River following the resumption of traffic after fog lifted Tuesday, suppliers who could meet the buyer's needs were able to charge more. Platts assessed IFO 380 at $637/mt ex-wharf, a $14/mt increase from the day before. The opposite situation is in Houston, with demand remaining minimal. As a result of this, probably, bunker prices were heard only slightly higher due to the rise in US Gulf Coast residual fuel, which was assessed 46.50 cents/b higher at $96.335/b. The increase is the equivalent of $2.95/mt. Based on this, as well as indications, Platts assessed IFO 380 $3/mt higher at $621.50/mt ex-wharf.

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 - Housing Starts Medium 17-jan 8:30 AM Dec 880K 861K - Building Permits Medium 17-jan 8:30 AM Dec 880K 899K - Philadelphia Fed Medium 17-jan 10:00 AM Jan 1.0 4.6 - Mich Sentiment High 18-jan 9:55 AM Jan 76.0 72.9 -

Source: OW Risk Management