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 some volatility during the last week, Crude Oil is trading in the same range for more than a month around $110/bbl for Brent and $87/bbl for WTI as investors are looking at the outcome of the US fiscal cliffs talks. US politicians are working towards averting a “US fiscal cliff” which involves tax hikes and spending cuts and expires at the end of the calendar year. If not averted this would severely derail the current fragile US economic growth and could potentially flip it back into recession. The recent US economic data have been slightly better than expected which lifted market sentiment. The US Senate has approved broader sanctions against Iran pressuring Tehran to give up its nuclear program. All these provide some level of support for crude prices. The January WTI contract closed at $88.91/bbl, up +$0.84 and Brent settled at $111.23/bbl, up by +$0.47. The ECB has lowered its growth outlook for the Eurozone and left interest rate level unchanged. November China Manufacturing rose to a seven-month high and looks like China could maintain a 7,5% annual economic growth next year. The US manufacturing data will be released later today which will provide further guidance. This morning, crude prices are trading mixed with Brent up 0,15.

Fueloil Specifics

The Northwest European fuel oil markets firmed slightly last Friday following stronger crude values. Both cargo and delivered 380cst product in Rotterdam were assessed up $1/mt versus previous day’s close. Rotterdam and Antwerp ports continuously saw restrained avails for hsfo. The Singapore markets inched up marginally $0.5-1.0 during the morning Platts window last Friday. The Singapore heavy residual inventory reported a slight build of +0.31 mbbl to 22.52 mbbl. The delivered bunker premiums were around $3.5 above cargo prices. Bunker fuel oil swaps gained app.$1.5/mt along the curve both for Rotterdam and Singapore papers. This morning both markets are trading slightly higher.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Dec Jan Feb Q113 Q213 2013 NYMEX WTI Swap (1st month) 0.84 88.91 ↓ 89.05 89.63 90.21 90.22 91.47 91.30 ICE Brent Swap (1st month) 0.47 111.23 ↑ 110.92 110.05 109.41 109.46 108.03 107.42 ICE Gasoil Swap (1st month) 1.50 950.25 ↓ 953.42 953.58 950.92 950.42 938.17 935.78 3.5% Barges FOB Rtdm 0.50 580.50 ↑ 585.75 590.25 594.00 593.75 601.25 599.50 3.5% Cargoes FOB Med 0.50 568.75 ↑ 573.50 581.25 587.75 587.00 596.00 594.50 1.0% Cargoes FOB NWE 4.75 604.75 ↑ 610.25 615.75 620.00 619.75 628.25 626.50 3% no. 6 USGC WB 2.81 95.68 ↑ 93.29 93.14 93.27 93.75 93.97 93.66 380 CST Cargoes FOB S'pore 0.50 598.75 ↑ 608.50 612.50 617.00 616.50 625.00 623.50 0.1 % GO Barges FOB Rtdm 1.75 950.75 ↓ 953.25 954.25 951.25 951.25 939.25 937.25 Physical Rotterdam 380 CST 1.00 587.00 ↑ 596.00 600.50 604.25 604.00 611.50 609.75 Physical Singapore 380 CST (1.50) 602.00 ↑ 618.75 622.75 627.25 627.25 635.75 634.25

Focus of the day: Gibraltar

The Gibraltar Strait starts this week free of congestion, with new cargoes having arrived over the weekend and good weather forecast that will support smooth operations and good avails of all products. Some suppliers are fully booked until mid this week, however others still do have room to accommodate prompt requirements. CIF Med 3.5% is trading $5/mt above FOB barges Rotterdam this morning and the HILO spread is widening slightly to $34. Bunker premiums today in Gibraltar are slightly higher than last week. The Med market is trading up this morning.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual ISM Index High 03-Dec 10:00 AM Nov 50.0 51.7 - Construction Spending Medium 03-Dec 10:00 AM Oct 0.3% 0.6% - MBA Mortgage Index Medium 05-Dec 7:00 AM 01-Dec NA -0.9% - ADP Employment Change Medium 05-Dec 8:15 AM Nov 125K 158K - Productiivity- Rev. Medium 05-Dec 8:30 AM Q3 2.4% 1.9% - Factory Orders Medium 05-Dec 10:00 AM Oct -0.5% 4.8% - ISM Services Medium 05-Dec 10:00 AM Nov 53.0 54.2 - Initial Claims Medium 06-Dec 8:30 AM 01-Dec 385K 393K - Nonfarm Payrolls High 07-Dec 8:30 AM Nov 80K 171K - Unemployment Rate High 07-Dec 8:30 AM Nov 8.1% 7.9% - Mich Sentiment High 07-Dec 9:55 AM Dec 82.0 82.7 - Consumer Credit Medium 07-Dec 3:00 PM Oct $8.0B $11.4B -

Source: OW Risk Management