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 extended the rally with a tenth day positive close for Brent driven by optimistic market sentiment. The US 4th quarter GDP reported an unexpected dip of -0.1% vs 1,1% forcasted- the weakest since 2009 due to a sharp drop in defense spending (-22%). Crude kept its gains after the US Federal Reserve kept unchanged its bond buying plan of $85 bln a month. The US inventory showed a massive Crude build of +6.0 mbbl but product inventories draw more than expected with -2,3 Mios bbl for Distilllates and close to -1 Mios bbl for Gasoline. The March WTI contract closed higher by +$0.37 at $97.94/bbl and  Brent settled at $114.98/bbl, up +$0.54. The market will now focus on tomorrow’s US labor data.  This morning, crude prices are trading down.

Fueloil Specifics

The Northwest European fuel oil markets edged higher yesterday following stronger crude values. Delivered 380cst product in Rotterdam was assessed app.$4/mt supported by tight product avails. Hamburg port reported a busy day as buyers were eager to fix their stems before prices moved even higher. The Singapore fuel oil market rose another $3.0 to $5.0 during the morning window. The 380cst cargo premiums rose on stronger buying interest from discount to premium of $0.31. The delivered bunker premiums were seen app. $4.5 above cargo prices yesterday. Bunker fuel oil swaps posted $2.0-2.5/mt along the curve both for Rotterdam and Singapore papers. This morning both markets continue trading higher.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Feb Mar Apr Q213 Q313 Q413 NYMEX WTI Swap (1st month) 0,37 97,94 ↓ 97,77 98,19 98,56 98,78 98,39 97,10 ICE Brent Swap (1st month) 0,54 114,90 ↓ 114,14 113,22 112,45 111,74 109,65 109,65 ICE Gasoil Swap (1st month) 4,50 990,75 ↓ 983,17 973,83 965,50 958,83 947,78 937,11 3.5% Barges FOB Rtdm 3,75 621,75 ↑ 622,50 621,25 619,75 618,25 614,25 609,25 3.5% Cargoes FOB Med 2,50 612,75 ↑ 615,25 615,25 613,75 613,75 609,75 604,75 1.0% Cargoes FOB NWE 7,50 652,75 ↑ 656,00 656,50 655,75 654,25 648,25 639,25 3% no. 6 USGC WB 1,05 98,33 ↑ 98,55 97,80 97,55 97,30 96,55 95,80 380 CST Cargoes FOB S'pore 4,75 639,75 ↑ 643,75 644,50 643,25 642,25 638,00 634,00 0.1 % GO Barges FOB Rtdm 5,50 989,75 ↓ 983,25 974,25 966,25 960,25 947,25 937,25 Physical Rotterdam 380 CST 4,00 627,00 ↑ 629,75 628,50 627,00 625,50 621,50 616,50 Physical Singapore 380 CST 6,00 643,50 ↑ 651,00 651,75 650,50 649,50 645,25 641,25

Focus of the day: Houston

The physical Gulf Coast 3% market moved up in line with the fuel oil paper market Wednesday, as market sources said lower demand and buying interest gave little reason for the physical premium to paper to widen. Weaker demand in the Singapore and European fuel oil markets bled over to the physical Gulf Coast market. Houston was assessed $6 higher at $644/mt and New Orleans was assessed $6 higher at $654/mt.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual Durable Orders High 28-jan 8:30 AM Dec 2.5% 0.8% 4.6% Pending Home Sales Medium 28-jan 8:30 AM Dec 0.0% 1.7% -4.3% Case-Shiller 20-city Index Medium 29-jan 9:00 AM Nov 5.0% 4.3% 5.5% Consumer Confidence High 29-jan 10:00 AM Jan 61.0 65.1 58.6 ADP Employment Change Medium 30-jan 8:15 AM Jan 175K 215K 192K GDP- Adv. High 30-jan 8:30 AM Q4 0.2% 3.1% -0.1% FOMC Rate Decision High 30-jan 2:15 PM Jan 0.25% 0.25% 0.25% Initial Claims Medium 31-jan 8:30 AM 26-jan 365K 330K - PCE Prices- Core Medium 31-jan 8:30 AM Dec 0.1% 0.0% - Chicago PMI Medium 31-jan 9:45 AM Jan 50.0 48.9 - Nonfarm Payrolls High 01-feb 8:30 AM Jan 195K 155K - Unemployment Rate High 01-feb 8:30 AM Jan 7.7% 7.8% - Michigan Sentiment- Final Medium 01-feb 9:55 AM Jan 70.5 71.3 - ISM Index High 01-feb 10:00 AM Jan 49.5 50.7 -

Source: OW Risk Management