Market in Brief

Crude prices rebounded from initial weakness: the August WTI contract closed above the $80 mark at $80.21/bbl, up +$0.85 while Brent futures were up $0.48 to $93.50/bbl. Market was temporary lifted by strength seen in equities. Sentiment was improved by the volatile US May durable goods data which rose 1.1% after two straight months of decline and the US May Pending Home sales at + 5.9%, at a two year high. Further gains were however limited by the overall bearish US weekly inventory report yesterday. There was a slight crude draw; less than expected on a high refinery runs at 92.6 with a big build in gasoline stockpiles +2.1 mbbl. The US will publish its final GDP figures and also the weekly jobless claims data later today. The Euro remains weak ahead of today's Italian bond auctions and also before the start of a 2 days EU summit meeting in Brussels. Market expectations are low after the German chancellor said “Nein” to Eurobonds as long as Governments are not ready to give up their fiscal sovereignty. The ECB is likely to cut interest rate next week to boost the market. This morning, crude is trading down.
 

Fueloil Specifics

The NWE fuel oil prices remained on the higher side on Wednesday supported by ongoing tight product avails. Cargo prices were up by app.$9/mt, while delivered 380cst product gained app.$8/mt. ARA hub continues to struggle with loading issues with some suppliers fully booked until Monday next week. The Singapore fuel oil markets eased slightly yesterday, slipping -$1.0-0.5/mt during the morning window yesterday. The fundamental forwards continued to be firm as cargo premiums have been gaining. The bunker premiums were seen around $8.5 above cargo prices yesterday. This morning both markets are trading slightly down.
 

Settlement & Indications (mid values)

Focus of the day: Gibraltar

The Strait of Gibraltar is seeing a quite good demand this week. A month that started rather slow picked up during the second half, bringing average volumes back to normal. However, prompt requirements are still possible to book. The three ports in the Strait are running smoothly today, with good weather forecast for the rest of the week and no big delays expected. Good avails of all products and barges. Algeciras continues being quite as competitive as Gibraltar. Bunker premiums remain quite similar than those seen last week. The HILO spread widening slightly to some 36 USD. The Med market is trading down this morning.
 

Economy fundamentals this week