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

Brent prices trading around $106.00/bbl as cold winter is boosting heating oil demand especially in the US, offsetting weak economic data from US and China. A lower than expected China Non-Manufacturing data weighted on prices coupled with a strong equity market sell-off due to fears on emerging markets. Support for Brent came from Libya where troops have been sent into the Eastern region to halt a long-standing blockade of export facilities. The Brent-WTI spread rebounded from a low app. $8/bbl back to $9.75/bbl. EIA Stats Wednesday will most likely be showing another sizable crude supply build of around 3mb. Market is also forward looking to the crucial US Unemployment numbers Friday. All considered this week from weather to development in Libya we see a high chance of Brent trading within $104-$107/bbl. This morning Brent is trading down 0,1% and WTI up 0,40%.

Fueloil Specifics

The NWE bunker fuel oil prices weakened yesterday tracking falling Brent values. Delivered 380cst product in Antwerp and Rotterdam lost nearly $7/mt compared to previous close. Suppliers reported mixed demand in different ports. Limited physical buying interest in Singapore bunker market started the week due to Lunar New Year celebration. Bunker premium rose to above $12.00/mt reflecting tight supply and raising premiums. Delivered 380cst was seen erratic from below Fridays Ex-wharf 625.50/mt to above depending on ETA. Physical declined more than paper, 380cst Ex-Wharf fell 8.50/mt to 617.00/mt. Paper soften a bit in the front time spread 180CF  F/M from 9.00/mt to 8.25/mt and VISCO as well came off from Friday’s strong note. This morning both markets are trading slightly higher.

Settlement & Indications (mid values)

Product Yesterday's Values   Forward Indications Product Change Last Dir. Feb Mar Apr Q214 Q314 Q414 NYMEX WTI Swap (1st month) (1,06) 96,43 ↑ 96,56 95,77 94,01 94,01 91,44 89,39 ICE Brent Swap (1st month) (0,36) 106,04 ↓ 105,58 105,02 104,58 104,19 102,96 101,47 ICE Gasoil Swap (1st month) (14,00) 903,00 ↑ 902,33 897,75 893,75 890,67 885,36 880,44 3.5% Barges FOB Rtdm (8,25) 562,25 ↑ 567,00 567,00 566,50 566,00 563,75 559,75 3.5% Cargoes FOB Med (6,50) 569,25 ↑ 569,25 565,25 564,00 563,50 561,25 557,00 1.0% Cargoes FOB NWE (10,25) 590,50 ↑ 591,75 589,00 588,50 588,25 586,25 579,25 3% no. 6 USGC WB (0,48) 87,77 ↑ 88,57 88,85 89,02 88,69 88,31 88,31 380 CST Cargoes FOB S'pore (6,25) 608,50 ↑ 603,50 593,75 589,50 589,00 586,00 583,50 0.1 % GO Barges FOB Rtdm (13,00) 901,50 ↑ 903,25 899,25 895,25 892,25 886,25 881,25 Physical Rotterdam 380 CST (7,00) 565,00 ↑ 572,25 572,25 571,75 571,25 569,00 565,00 Physical Singapore 380 CST (8,50) 619,75 ↑ 608,75 599,00 594,75 594,25 591,25 588,75

Focus of the day: ARA

Last week was like any other week in Rotterdam. We are still experiencing some installations having trouble with time tables which lead to a few delays. It is especially the Totsa Terminal in Flushing that has too little stock around. It is however nothing like in Q4 last year and the situation is looking better due to the current low demand for bunkers. On the product side we are seeing enough high sulphur on the water while low sulphur looked tighter last week. We saw the few 1% traders creating a hilo play in the window throughout the week seeing the hilo moving in early in the week and ending the week more than $10 higher. This week we have seen the 1% softening and we expect the hilo to move towards $30 again.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual ISM Index High 3-Feb 10:00 AM Jan 57.0 56.5 51.3 Factory Orders Medium 4-Feb 10:00 AM Dec -2.0% 1.8% - ADP Employment Change Medium 5-Feb 8:15 AM Jan 175K 238K - ISM Services Medium 5-Feb 10:00 AM Jan 53.5 53.8 - Initial Claims Medium 6-Feb 8:30 AM 01-feb 330K 348K - Trade Balance Medium 6-Feb 8:30 AM Dec -$37.0B -$34.3B - Nonfarm Payrolls High 7-Feb 8:30 AM Jan 150K 74K - Unemployment Rate High 7-Feb 8:30 AM Jan 6.5% 6.7% -

Source: OW Risk Management