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

With the US closed it was a quiet trading session yesterday, as Crude Oil started the week in the red during the Asian session but recovered in European trading. The November WTI contract closed at $89.33/bbl, down $0.55 and Brent settled at $111.82/bbl, down only $0.20 after hitting an intra-low of $110.54/bbl. Crude prices were also pressured by a stronger USD or more precisely a weaker Euro due to concerns with the Eurozone. The IMF downgraded its economic growth forecast for East Asia and Pacific region. The IMF sees alarming risk of deeper slump in global growth. This morning, crude is trading up.

Fueloil Specifics

The NWE fuel oil markets closed yesterday with losses. Delivered 380cst product posted app.$7/mt loss following even weaker cargo prices, that were assessed down by $8/mt. Demand remained sluggish while Rotterdam reported tight avails for prompt HSFO and LSFO products. The Singapore fuel oil market fell more than $16.0 yesterday during the morning Platts window. The demand was stronger as lower outright prices attracted buying. The delivered bunker premiums were lifted to around $8.25 above cargo prices. Bunker fuel oil swaps posted app.$7/mt losses at the front of the forward curve both for Rotterdam and Singapore papers. The backend was significantly stronger, remaining largely unchanged from previous day. This morning both markets are trading down.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Nov Dec Jan Q113 Q213 2013 NYMEX WTI Swap (1st month) (0.55) 89.33 ↑ 90.33 90.73 91.19 91.47 91.94 90.34 ICE Brent Swap (1st month) (0.20) 111.82 ↑ 111.15 110.38 109.69 109.08 107.51 111.19 ICE Gasoil Swap (1st month) 4.00 993.50 ↑ 975.33 965.50 957.33 950.22 934.47 933.19 3.5% Barges FOB Rtdm (8.25) 608.50 ↓ 606.75 606.75 607.00 606.75 603.00 600.75 3.5% Cargoes FOB Med (5.25) 607.25 ↓ 601.75 600.75 599.50 601.75 599.00 596.75 1.0% Cargoes FOB NWE (9.25) 646.50 ↓ 643.75 641.75 641.75 641.50 637.25 635.00 3% no. 6 USGC WB (1.35) 95.60 ↓ 94.44 94.34 94.17 94.17 93.47 93.02 380 CST Cargoes FOB S'pore (16.25) 632.00 ↓ 629.50 629.75 629.75 629.50 626.25 623.75 0.1 % GO Barges FOB Rtdm 5.25 992.75 ↑ 975.25 966.25 958.25 951.25 936.25 935.25 Physical Rotterdam 380 CST (7.00) 619.00 ↓ 617.00 617.00 617.25 617.00 613.25 611.00 Physical Singapore 380 CST (13.00) 640.00 ↓ 639.75 640.00 640.00 640.25 637.00 634.50

Focus of the day: ARA

Despite the market moving to below $110/bbl on Brent last week but regaining everything just overnight we experienced a little difficult situation for HS products in ARA. Mainly Rotterdam was suffering from tight avails and loading difficulties, many suppliers could only offer for enquiries with more than one week notice. Fortunately in the beginning of this week the situation has become better. On the low sulphur side there seems to be enough product wherefore many suppliers offer rather aggressive prices. HI/LO spread around $40/45 these days.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual Wholesale Inventories Medium 10-Oct 10:00 AM Aug 0.5% 0.7% - Treasury Budget Medium 10-Oct 2:00 PM Sep NA -$62.8B - Initial Claims Medium 11-Oct 8:30 AM 06-Oct 375K 367K - Trade Balanace Medium 11-Oct 8:30 AM Aug -$44.6B -$42.0B - Core PPI High 12-Oct 8:30 AM Sep 0.1% 0.2% - Mich Sentiment High 12-Oct 9:55 AM Oct 80.0 78.3 -

Source: OW Risk Management