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 price movements continued to focus on the narrowing Brent/WTI spread. The April WTI contract slipped -$0.02 to $92,52/bbl and Brent which is expiring today, fell by -$1.13 to $108.52/bbl. The next active May Brent futures closed at $108.24/bbl. The US equities continue to beat record high everyday reflected by improving US market fundamentals. The US February Retail Sales figure at +1.1%, was higher than the expected +0.7% and showing that the US consumer is still optimistic which is a good news for the US economy. The US dollar strengthened now on a new 3 month high against the Euro which naturally pressure dollar priced commodities. The Italian 3yr bond auction managed to sell successfully but interest was less enthusiastic than expected and resulted in higher yields. The US DOE Weekly Inventory reported a build in crude Oil (+2,6 Mios bbl) as expected, Distillates a surprise marginal build and Gasoline a bigger draw (-3,6 Mios bbl). Today, we will see the weekly US jobless claims data and the February Producer Price Index (PPI). This morning, crude is trading +0,34% up.

Fueloil Specifics

The Northwest European bunker fuel oil markets reported increased demand in the morning hours. However it diminished in the afternoon following lower prices. Delivered 380cst product both in Antwerp and Rotterdam were assessed nearly $5/mt down from previous days close. The Singapore fuel oil market fell between -$3.00 to -$0.50 during the Platts window yesterday. The fundamentals are looking firm with healthy buying interest which lifted the cargo premium to more than $2.50. The delivered bunker premiums were also firming, seen between $6.0 to $8.5 above cargo prices. Bunker fuel oil swaps lost up to $7/mt at the front of the forward curve. Backend was slightly stronger, with cal2014 papers posting app.$4.5/mt losses. This morning both markets are trading higher.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Apr May Jun Q313 Q413 2014 NYMEX WTI Swap (1st month) (0,02) 92,52 ↑ 93,19 93,47 93,60 93,10 92,05 89,69 ICE Brent Swap (1st month) (1,13) 108,52 ↑ 107,91 107,45 106,99 105,84 104,40 101,46 ICE Gasoil Swap (1st month) (12,50) 912,50 ↑ 913,00 914,08 913,58 910,11 904,78 887,88 3.5% Barges FOB Rtdm (7,25) 597,75 ↑ 600,00 598,50 597,25 594,25 588,75 577,00 3.5% Cargoes FOB Med (6,00) 592,25 ↑ 594,00 595,75 594,75 590,50 583,75 573,00 1.0% Cargoes FOB NWE (7,00) 618,25 ↑ 623,50 626,50 627,50 625,50 619,25 604,50 3% no. 6 USGC WB (0,35) 95,84 ↑ 94,40 94,15 93,90 93,40 92,40 88,40 380 CST Cargoes FOB S'pore (0,75) 632,00 ↑ 624,00 622,00 621,25 618,75 614,75 604,25 0.1 % GO Barges FOB Rtdm (11,25) 909,25 ↑ 914,25 915,25 914,25 913,25 907,25 889,25 Physical Rotterdam 380 CST (5,00) 604,75 ↑ 607,25 605,75 604,50 601,50 596,50 585,25 Physical Singapore 380 CST (1,50) 637,50 ↑ 631,75 629,75 629,00 626,50 622,50 611,50

Focus of the day: Houston

Demand remains poor in Houston. Bunker prices in the US fell on Wednesday in line with the drops in fuel oil and crude futures. Done deals in Houston were heard at a low price, which makes Platts assessed IFO 380 at only $607/MT, a $5 decrease from Tuesday while USGC 3% was assessed only 30 cents lower at $95.34 an equivalent to $2.22/MT decrease. Demand in New Orleans is not better but market has talked about a premium of $1 to Houston which is assessed at $608/MT. The same story for US East Coast, Norfolk IFO 380 was heard indicated at $630/mt, down $6 from Tuesday, though no deals were reported done. New York IFO 380 was assessed down $6.5/MT to $616.5/MT.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual Retail Sales High 13-mar 8:30 AM Feb 0.2% 0.1% 1.1% Business Inventories Medium 13-mar 10:00 AM Jan 0.6% 0.4% 1.0% Initial Claims Medium 14-mar 8:30 AM 09-mar 350K 340K - Continuing Claims Medium 14-mar 8:30 AM 09-mar 3100K 3094K - Core PPI High 14-mar 8:30 AM Feb 0.2% 0.2% - Core CPI High 15-mar 8:30 AM Feb 0.2% 0.3% - Empire Manufacturing Medium 15-mar 8:30 AM Mar 5.0 10.0 - Industrial Production Medium 15-mar 9:15 AM Feb 0.6% -0.1% - Mich Sentiment Medium 15-mar 9:55 AM Mar 79.0 77.6 -

Source: OW Risk Management