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

Friday’s trading was mixed as Brent futures rallied and closed up 16 cents at 108.83/bbl, just off the high for the day after testing 108./bbl. Jan WTI futures fell on the day, with the front month contract losing 90 cents to close at $90.60/bbl. Once again the main driver on Friday was upbeat economic data from the US on Thursday, which added to speculation that the US Federal Reserve could announce a reduction in QE at this week’s FOMC meeting on Dec 17-18. Meanwhile Brent looks supported this morning by concerns revived after Libya failed to reach a deal with tribal leaders to end the blockade of several oil-exporting ports. Should exports be realized, the Brent curve will likely see further weakening with February Brent premium against WTI narrowing to below $10/bbl.  This morning’s differential is around $12,72/bbl area. The Preliminary China’s December Manufacturing sector was slightly less busy this month coming to a three months low of 50,5 vs 50,8 in November. This morning Brent is trading around 0,80% up and WTI +0,25%.

Fueloil Specifics

The Northwest European bunker fuel oil prices fell last Friday following weakening Brent. Delivered 380cst product both in Antwerp and Rotterdam was assessed nearly $6/mt down. However, premiums for prompt deliveries remained on the higher side due to delays at loading installations. Friday’s trade firmed up Spore 380CF paper from a week ago reflected on time spreads especially j/f and f/m. Fuel oil flat price paper as well saw strong note despite unchanged crude levels and this morning in Asia swap indication value Bal Dec 380CF 607.75/mt up +5.25/mt from Fridays assessment.  In the physical market as pricing session moved closer to January, bids and offers were seen firmer, in line with the direction of the derivatives market after some divergence on Thursday. Some support could have been drawn from slightly lower arbitrage cargoes slated for January arrival into Singapore. Current estimates stood at 3.74 million tones, about 7.2 percent lower than the count for December arrival volumes into Singapore, which are estimated at 4.03 million tones, Reuters oil analytics data showed. Singapore marine fuel sales declined in November for the first time since August, in line with fewer vessel arrivals for bunker refueling as compared with October, according to data from the Maritime and Port Authority of Singapore.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Jan Feb Mar Q114 Q214 2014 NYMEX WTI Swap (1st month) (0,90) 96,60 ↑ 97,12 96,95 96,53 96,87 95,27 94,07 ICE Brent Swap (1st month) 0,16 108,83 ↑ 109,12 108,82 108,81 108,51 107,87 107,27 ICE Gasoil Swap (1st month) (14,25) 917,75 ↑ 928,67 926,92 924,58 926,61 920,61 919,34 3.5% Barges FOB Rtdm 1,25 574,50 ↑ 583,50 584,50 584,75 584,25 584,75 583,50 3.5% Cargoes FOB Med (2,00) 571,50 ↑ 581,50 582,00 582,00 581,75 582,00 581,50 1.0% Cargoes FOB NWE (8,50) 601,50 ↑ 604,00 607,00 608,00 606,25 609,00 606,50 3% no. 6 USGC WB 0,49 90,60 ↑ 91,50 91,25 91,25 91,25 91,00 91,00 380 CST Cargoes FOB S'pore (2,50) 601,75 ↑ 608,50 606,75 606,00 607,00 605,75 605,50 0.1 % GO Barges FOB Rtdm (7,25) 920,00 ↑ 930,25 928,25 923,25 928,25 921,25 919,25 Physical Rotterdam 380 CST (6,00) 575,25 ↑ 588,75 589,75 590,00 589,50 590,00 588,75 Physical Singapore 380 CST (3,50) 606,50 ↑ 613,75 612,00 611,25 612,25 611,00 610,75

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual Empire Manufacturing Medium 16-Dec 8:30 AM Dec 5.0 -2.2 - Industrial Production Medium 16-Dec 9:15 AM Nov 0.4% -0.1% - Core CPI High 17-Dec 8:30 AM Nov 0.1% 0.1% - Housing Starts Medium 18-Dec 8:30 AM Nov 2750K 2744K - Building Permits Medium 18-Dec 8:30 AM Nov 975K 1034K - FOMC Rate Decision High 18-Dec 2:00 PM Dec 0.25% 0.25% - Initial Claims Medium 19-Dec 8:30 AM 14-dec 335K 368K - Existing Home Sales Medium 19-Dec 10:00 AM Nov 4.98M 5.12M - Philadelphia Fed Medium 19-Dec 10:00 AM Dec 4.0 6.5 - Leading Indicators Medium 19-Dec 10:00 AM Nov 0.7% 0.2% - GDP (Annualized) High 20-Dec 8:30 AM Q3 3.6% 3.6% -

Source: OW Risk Management