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 opened the week under pressure after the news that the Saudis had cut September oil export price to the US customers. This move indicates that Saudi Arabia wants to preserve its market share in the US where oil production is at its highest in three decades due to the boom in Shale Oil. Saudi Arabia is still comfortable with the current Oil prices while other OPEC members need higher prices to sustain their national spending. The December WTI futures settled at $78.78/bbl, down -$1.76 while December Brent futures dropped -$1.08 to close at $84.78/bbl. The US ISM October Manufacturing Index came out higher than expected at +59.0% against the previous 56.5%. There is the mid-term US election later today for the Senate, House seats and 36 state governors and historically, it has usually provided a boost for the equity market. The US September Factory Orders and October Trade Balance will be released later today. This morning, crude prices are trading around -1,20% lower.

Fueloil Specifics

The NWE bunker fuel oil markets started the week with the same mood as it closed last week. Suppliers continued to struggle with tight product avails even though demand weakened. Delivered 380cst product in the main ports of Rotterdam and Antwerp was assessed app. $1/mt down vs previous close. The Singapore fuel oil prices fell app. $5/mt during the Asian Platts window yesterday. The Singapore physical cargoes saw aggressive offers pressuring premiums much lower. The delivered bunker premiums were +$5.75 above cargo prices yesterday. This morning both markets are trading significantly lower.

Settlement & Indications (mid values)

Product Yesterday's Values   Forward Indications Product Change Last Dir. Nov Dec Jan Q115 Q215 2015 NYMEX WTI Swap (1st month) (1,76) 78,78 ↓ 77,59 77,69 77,76 77,75 77,76 78,20 ICE Brent Swap (1st month) (1,08) 84,78 ↓ 83,79 84,35 85,48 86,40 87,31 89,10 ICE Gasoil Swap (1st month) 4,75 746,50 ↓ 733,58 733,25 743,42 - - - LS ICE Gasoil Swap (1st month) - - ↓ - - - 748,94 755,61 759,33 3.5% Barges FOB Rtdm (4,25) 445,75 ↓ 435,00 434,00 436,75 440,25 447,50 450,75 3.5% Cargoes FOB Med (2,75) 452,00 ↓ 437,25 432,50 434,75 438,25 445,50 448,75 1.0% Cargoes FOB NWE (6,00) 450,00 ↓ 439,50 439,25 442,50 446,50 455,00 459,00 3% no. 6 USGC WB (1,95) 67,20 ↓ 67,30 67,90 68,25 68,78 69,89 70,80 380 CST Cargoes FOB S'pore (4,25) 471,25 ↓ 461,75 463,50 462,75 464,75 469,75 473,50 0.1 % GO Barges FOB Rtdm 4,50 746,50 ↓ 733,25 732,25 742,25 736,25 744,25 747,25 Physical Rotterdam 380 CST (1,00) 453,50 ↓ 445,25 444,25 447,00 448,50 456,75 460,00 Physical Singapore 380 CST (4,00) 477,50 ↓ 472,00 473,75 473,00 473,00 479,00 482,75

Focus of the day: ARA

The only discount that went a little bit down was the RMK, but that had more to do with the in general higher notification and backwardation than the actual avails of the product. High sulphur remains expensive in Antwerp and Amsterdam, while prices in Rotterdam are more reasonable. With VLCC’s queuing and waiting for the product outside the ARA we hold the advice of buying well in advance in order to have a choice of suppliers. The low sulphur product is slowly being phased out, which is reflected in relatively low premiums. The low premium would instinctively indicate an abundance of product, but one couldn’t be more wrong, as loading is still going far from smoothly. Buy in advance and you’ll have a good chance to pay a sharp price. Gasoil discounts are firming a bit and orders are getting booked well in advance. It is of the advice to do same. Book once you know you’re in need. Notification periods for the different grades are: six days for high sulphur, five working days for low sulphur and four days for gasoil enquiries.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual ISM Index High 3-Nov 10:00 AM Oct 55.9 56.66 59.0 Construction Spending Medium 3-Nov 10:00 AM Sep 1.1% -0.8% -0.4% Factory Orders Medium 4-Nov 10:00 AM Sep -0.5% -10.1% - ADP Employment Change Medium 5-Nov 8:15 AM Oct 235K 213K - ISM Services High 5-Nov 10:00 AM Oct 58.0 58.6 - Challanger Job Cuts Medium 6-Nov 7:30 AM Oct NA -24.4% - Initial Claims Medium 6-Nov 8:30 AM 01-nov 290K 287K - Productivity- Prel Medium 6-Nov 8:30 AM Q3 1.5% 2.3% - Nonfarm Payrolls High 7-Nov 8:30 AM Oct 275K 248K - Unemployment Rate High 7-Nov 8:30 AM Oct 6.0% 5.9% -

Source: OW Risk Management