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 rose yesterday, October Brent contract gained more than $1 to close at $115.78/bbl while there was no settlement for October WTI futures with the US closed for Labor Day Holiday. Markets are firm on hopes for stimuli measures from Central banks in the world. In the US the Unemployment data on Friday will be closely watched to have any hints on the next FOMC meetings next week. Geopolitical tensions still remain in the back between Israel and Iran and will continue to add a premium to the crude market. We believe that if Oil prices continue to rise we will hear again of Strategic Reserve Oil Release from the US going into an election year. A second Norwegian oil worker's strike was averted by a last minute successful wage deal negotiation. Today in terms of data, we will look at the US August ISM Manufacturing and Construction Spending for July. This morning, crude is trading higher.

Fueloil Specifics

The NWE fuel oil prices were up yesterday following stronger crude. Both delivered 380cst product in Rotterdam and cargo prices were assessed app.$7/mt up from previous day close. There was reported slow trading activity in the area during the day. LSFO avails remain tight in Rotterdam and suppliers in Antwerp were anticipating some HSFO shortages. The Singapore fuel oil markets rose between $5.5- 8.5 during the Platts window yesterday tracking crude movements. Market fundamentals look firm as cargo premiums remain strong. The delivered bunker premiums yesterday slipped to $6.5-8.0. This morning both markets are trading higher.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Oct Nov Dec Q113 Q213 2013 NYMEX WTI Swap (1st month) - 96.47 ↑ 97.66 98.03 98.42 98.72 98.19 98.04 ICE Brent Swap (1st month) 1.21 115.78 ↑ 115.59 115.11 114.63 113.50 111.84 115.11 ICE Gasoil Swap (1st month) 6.50 1001.50 ↑ 1003.33 998.50 993.92 982.28 965.69 964.66 3.5% Barges FOB Rtdm 7.50 658.75 ↑ 660.00 656.25 653.00 647.75 638.25 634.00 3.5% Cargoes FOB Med 4.50 649.75 ↑ 653.50 650.25 647.50 642.50 633.50 629.50 1.0% Cargoes FOB NWE 6.75 720.50 ↑ 711.00 702.25 695.50 685.75 675.00 670.25 3% no. 6 USGC WB 1.65 102.65 ↑ 102.50 102.00 101.50 99.25 98.00 98.75 380 CST Cargoes FOB S'pore 5.75 680.25 ↑ 682.25 679.25 676.00 671.25 662.00 656.75 0.1 % GO Barges FOB Rtdm 6.00 998.75 ↑ 1003.25 999.25 994.25 983.25 967.25 966.25 Physical Rotterdam 380 CST 7.00 664.00 ↑ 670.25 666.50 663.25 658.00 648.50 644.25 Physical Singapore 380 CST 4.00 687.75 ↑ 692.50 689.50 686.25 682.00 672.75 667.50

Focus of the day: ARA

The ARA market has recovered from low availability. 500cst product availability remains slightly low for another month, but we anticipate this trend to end soon. On the positive side we are seeing a lot of interest in 1% for September meaning that the replenishment and blending has been done. It is now safe to say that the timing is right for traders to engage in short term commitments with low premiums. This is of course very beneficial for purchasers willing to take part in such short term solutions.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual ISM Index High 04-Sep 10:00 AM Aug 49.0 49.8 - Construction Spending Medium 04-Sep 10:00 AM Jul 0.5% 0.4% - MBA Mortgage Index Medium 05-Sep 7:00 AM 01-Sep NA -4.3% - Productivity- Rev. Medium 05-Sep 8:30 AM Q2 1.8% 1.6% - Challanger Job Cuts Medium 06-Sep 7:30 AM Aug NA -44.5% - ADP Employment Change Medium 06-Sep 8:15 AM Aug 150K 163K - Initial Claims Medium 06-Sep 8:30 AM 01-Sep 375K 374K - ISM Services Medium 06-Sep 10:00 AM Aug 51.0 52.6 - Nonfarm Payrolls High 07-Sep 8:30 AM Aug 140K 163K - Unemployment Rate High 07-Sep 8:30 AM Aug 8.2% 8.3% -

Source: OW Risk Management