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 fell below $112 bbl as growing doubts with in U.S. Federal Reserve about the side effects of its stimulus program and the prospect of more budget battles in Washington curbed investor appetite for riskier assets. Today’s EIA guidance as well as the Employment numbers will give near term oil price direction. We are still seeing some decoupling between Oil and equity markets and it could widen short term if Equities ratchet higher. Market is aware that- despite the beginning of the year optimism- we have heavy challenges for 2013 with short term, ample Oil stocks weak demand and still a sputtering engine growth. From a technical perspective, yesterday’s Oil violation of some key moving averages, 3 month highs, recent crude curve strength, etc. would  appear to favor some further price gains. However, as mentioned global oil demand doesn’t seam strong enough to support sustainable price advance with so far a mild winter. This morning crude is trading down.

Fueloil Specifics

The Northwest European fuel oil markets were slightly up yesterday, assessed app.$4/mt higher versus previous day close. Market players reported low demand during the day, picking slightly up in the afternoon. 3.5% Rtdam barges were significantly stronger, up by more than $11/mt. The Asian fuel oil’s crack for 180cst gained 53 cents/mt to $7.58/bbl while 380cst was up by 37 cents/mt to $9.11/bbl discounts to Dubai crude respectively on Thursday. The Singapore bunker differential – the price spread between delivered marine fuel prices and fuel oil cargo values – dropped $5.23/mt to $10.34/mt discount to 380-CST quotes. Delivered 380cst in Singapore was seen between $603/mt - $618/mt. Bunker fuel oil swaps gained up to $8/mt at the front and only $3-4/mt at the backend of the forward curve both for Rotterdam and Singapore papers. This morning both markets are trading slightly up.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Jan Feb Mar Q213 Q313 2013 NYMEX WTI Swap (1st month) (0,20) 92,92 ↓ 92,24 92,69 93,12 93,70 93,82 93,37 ICE Brent Swap (1st month) (0,33) 112,14 ↓ 110,67 109,63 108,83 107,52 105,71 106,76 ICE Gasoil Swap (1st month) (6,75) 935,75 ↓ 929,33 929,00 926,83 921,31 914,78 918,00 3.5% Barges FOB Rtdm 11,50 603,75 ↑ 604,00 604,50 604,50 604,25 601,75 602,00 3.5% Cargoes FOB Med 8,50 593,25 ↑ 595,25 596,75 595,75 598,25 597,25 596,25 1.0% Cargoes FOB NWE 5,00 657,50 ↑ 622,75 627,00 629,00 630,75 630,75 628,25 3% no. 6 USGC WB 1,27 98,15 ↑ 96,75 95,75 95,25 94,50 94,00 94,50 380 CST Cargoes FOB S'pore 5,00 618,75 ↑ 626,25 627,00 628,00 627,50 625,75 625,25 0.1 % GO Barges FOB Rtdm (7,75) 935,00 ↓ 929,25 930,25 927,25 922,25 914,25 916,25 Physical Rotterdam 380 CST 4,00 603,00 ↑ 614,25 614,75 614,75 614,50 612,00 612,25 Physical Singapore 380 CST 5,00 621,50 ↑ 637,50 638,25 639,25 639,25 637,50 637,00

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual ISM Index High 02-jan 10:00 AM Dec 51.0 49.5 50.7 Construction Spending Medium 02-jan 10:00 AM Nov 0.5% 1.4% -0.3% MBA Mortgage Index Medium 03-jan 7:00 AM 29-dec NA -12.3% -10.4% Challenger Job Cuts Medium 03-jan 7:30 AM Dec NA 34.4% -22.1% ADP Employment Change Medium 03-jan 8:15 AM Dec 150K 118K 215K Initial Claims Medium 03-jan 8:30 AM 29-dec 365K 350K 372K Nonfarm Payrolls Medium 04-jan 8:30 AM Dec 150K 146K - Unemployment Rate High 04-jan 8:30 AM Dec 7.7% 7.7% - Factory Orders Medium 04-jan 10:00 AM Nov 0.5% 0.8% - ISM Services Medium 04-jan 10:00 AM Dec 53.5 54.7 -

Source: OW Risk Management