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 started the week on a weak tone -as no quick resolution for the US government shutdown is in sight- but jumped towards the US close to keep the gains this morning. The 17th October deadline for increasing the debt ceiling is looming and Japan and China ratchet up the pressure by warning the US on default consequences. The November WTI contract settled at $103.03/bbl, down -$0.81 and Brent closed at $109.68/bbl, inched up by +$0.22. China service sector is expanding “substantially below trend”, the service PMI came in at 52,4 last month from 52,8 in August. The API Inventory numbers will be published later today and US crude supplies probably increased for a third week as refineries reduced operations, cutting demand for Oil. This morning, crude prices are trading marginally up.

Fueloil Specifics

The NWE bunker fuel oil markets started the week with slightly lower prices, steady demand and ongoing tight avails for prompt product in Rotterdam. Delivered 380cst product as the Platts close was assessed some $3-4/mt down versus previous close. The Singapore fuel oil markets fell more than $7.5 during the Platts window yesterday. The Asian fuel oil cracks extended weakness. The delivered bunker premiums ranged between $4.0 to $7.5 above cargo prices. This morning both markets are trading slightly down.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Nov Dec Q413 Q114 Q214 2014 NYMEX WTI Swap (1st month) (0,81) 103,03 ↑ 102,92 102,32 102,83 100,55 98,02 97,08 ICE Brent Swap (1st month) 0,22 109,68 ↑ 108,53 107,81 107,82 107,16 106,54 104,23 ICE Gasoil Swap (1st month) 3,75 926,25 ↑ 925,25 922,58 925,06 915,78 903,86 902,13 3.5% Barges FOB Rtdm (1,00) 583,00 ↓ 576,75 574,75 577,00 577,50 575,50 572,75 3.5% Cargoes FOB Med (0,75) 579,75 ↓ 571,75 568,25 571,75 570,50 568,50 566,50 1.0% Cargoes FOB NWE 2,25 593,00 ↓ 593,00 596,25 592,75 600,75 600,50 596,50 3% no. 6 USGC WB (0,41) 92,19 ↓ 91,00 90,75 91,00 90,75 90,20 89,95 380 CST Cargoes FOB S'pore (8,50) 609,75 ↓ 595,25 593,25 597,75 594,00 593,00 591,50 0.1 % GO Barges FOB Rtdm 4,50 926,25 ↑ 926,25 924,25 926,25 917,25 906,25 903,25 Physical Rotterdam 380 CST (4,00) 591,00 ↓ 582,00 580,00 582,25 582,25 579,75 577,00 Physical Singapore 380 CST (6,00) 614,75 ↓ 600,50 597,50 602,00 598,25 597,25 595,75

Focus of the day: ARA

This week has been so far determined by serious loading issues for the local supply chain in ARA. The waiting time for barges at the terminals piled up to several days (even four days was reported) and harmed mainly the high sulphur supplies. Some terminals are having maintenance which obviously gives suppliers less flexibility; especially prompt demand came therefore with an increased premium compared to the normal levels. The HiLo spread gained strength again, mainly during Fridays trading hours. While 3,5% lost around 9usd compared to Thursdays closing the 1% fuel only lost around 1usd and brought the HiLo spread back to around 20usd. Loading and avails situation for RMK is still good, however the premiums are becoming a little higher again. One could say that they are slowly coming back to healthier levels, but we will see what the following weeks will bring. To sum it up: RMK good avails, RMG HS requires good notice, preferably 6/7days, LS good avails also for rather short notice.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual Consumer Credit Medium 7-Oct 3:00 PM Aug $12.0B $10.4B $13.6B Non-farm Payrolls High 8-Oct Sep 180K 169K -   Unemployment Rate High 8-Oct Sep 7.3% 7.3% -   Trade Balance Medium 8-Oct 8:30 AM Aug -$40.0B -$39.1B - Wholesale Inventories Medium 9-Oct 7:00 AM Aug 0.2% 0.1% - Initial Claims Medium 10-Oct 8:30 AM 5-Oct 315K 308K - Treasury Budget Medium 10-Oct 2:00 PM Sep NA $75.18B - Retail Sales Medium 11-Oct 8:30 AM Sep -0.1% 0.2% - Core PPI Medium 11-Oct 8:30 AM Sep 0.1% 0.0% - Mich Sentiment High 11-Oct 9:55 AM Oct 73.0 77.5 - Business Inventories Medium 11-Oct 10:00 AM Aug 0.2% 0.4% -

Source: OW Risk Management