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 oil prices dropped significantly yesterday on bearish market sentiment with higher OPEC July output and positive economic releases out of US outweighing geopolitical fears. The US Inventory data reported bigger than expected crude draws at -3.70 mbbl against -0.90 mbbl. The crude inventory at Cushing also saw a draw of -0.92 mbbl. Despite the peak of the US driving season, EIA reported gasoline supplies rising by 0.365mbbl and reaching the highest level in four months due to poor demand. The positive economic data from the US and strength of the dollar in the past weeks have also weighted on dollar denominated oil. The US 2nd Quarter GDP figure came out at 4.0%, strongly above the forecasted 3.2%. The ADP employment figures- a precursor to the US labor data- were lower than forecasted though, increasing by 218K vs 230K. As expected, the US Federal Reserve will reduce its assets purchases by another $10 billion and will keep the interest rate unchanged while commenting on an improving US economy. The recent sanctions on Russia failed to inject fears as the market perceives the impact to be minimal at the moment. The September WTI futures closed at $100.27/bbl, down -$0.70 while Brent lost -$1.21 to settle below the 200- days moving average at $106.51/bbl. Today, we will see the US weekly jobless claims release before the important labor data tomorrow. This morning, crude prices are trading lower.

Fueloil Specifics

The Northwest European bunker fuel oil prices remained largely unchanged yesterday. The main ARA ports reported slow demand with tight HSFO avails for prompt deliveries. LSFO levels remained competitive as suppliers were eager to free the storage for fresh supplies. The Singapore fuel oil prices gained nearly $2.0/mt during the Asian Platts window yesterday tracking the crude price. The delivered bunker premiums were firm ranging between +$9.5 and +$10.25 above cargo. Market is seeing some tightness in bunker grade 380cst. This morning both markets are trading lower.

Settlement & Indications (mid values)

Product Yesterday's Values   Forward Indications Product Change Last Dir. Aug Sep Oct Q414 Q115 Q215 NYMEX WTI Swap (1st month) (0,70) 100,27 ↓ 98,81 97,82 96,55 96,59 95,37 94,05 ICE Brent Swap (1st month) (1,21) 106,51 ↓ 105,83 106,22 106,57 106,48 105,81 105,01 ICE Gasoil Swap (1st month) (0,75) 893,25 ↓ 883,83 886,92 889,67 891,17 - - 3.5% Barges FOB Rtdm (0,25) 571,00 ↓ 567,25 565,00 564,00 563,25 565,50 564,00 3.5% Cargoes FOB Med 1,00 576,00 ↓ 567,25 564,00 562,00 560,50 562,50 561,00 1.0% Cargoes FOB NWE 0,25 585,25 ↓ 582,25 584,00 583,50 582,25 582,50 582,25 3% no. 6 USGC WB (0,65) 88,50 ↓ 88,70 88,45 88,30 88,19 88,28 88,08 380 CST Cargoes FOB S'pore 0,75 599,25 ↓ 592,75 590,00 587,75 586,75 586,75 585,25 0.1 % GO Barges FOB Rtdm (0,25) 890,75 ↓ 883,25 886,25 889,25 890,25 - - Physical Rotterdam 380 CST 0,00 572,25 ↓ 572,50 570,25 569,25 568,50 570,75 569,25 Physical Singapore 380 CST 2,50 608,50 ↓ 598,25 595,25 593,00 592,00 592,00 590,50

Focus of the day: Houston

High sulfur bunker fuel prices on the US Gulf Coast fell Wednesday for the third consecutive day on the back of lower offers amid ample supplies and weak demand. IFO 380 Houston was offered at $579/mt, down $5/mt from Tuesday. In New Orleans, IFO 380 CST was offered at $590/mt, $2/mt lower from Tuesday, which set a premium of $11/mt over Houston. Typically the premium is $5-10/mt.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual Markit PMI Medium 28-Jul 9:45 AM Jul - 61.1 60.9 Case- Shiller 20-city Index Medium 29-Jul 9:00 AM May 10.5% 10.8% 9.3% Consumer Confidence Medium 29-Jul 10:00 AM Jul 86.5 85.2 90.9 ADP Employment Change Medium 30-Jul 8:15 AM Jul 225K 281K 218K GDP- Adv. High 30-Jul 8:30 AM Q2 3.6% -2.9% 4.0% FOMC Rate Decision High 30-Jul 2:00 PM Jul 0.25% 0.25% 0.25% Initial Claims Medium 31-Jul 8:30 AM 26-jul 310K 284K - Chicago PMI Medium 31-Jul 9:45 AM Jul 60.0 62.6 - Nonfarm Payrolls High 1-Aug 8:30 AM Jul 250K 288K - Unemployment Rate High 1-Aug 8:30 AM Jul 6.1% 6.1% - PCE Prices- Core High 1-Aug 8:30 AM Jun 0.2% 0.2% - ISM Index Medium 1-Aug 10:00 AM Jul 56.0 55.3 -

Source: OW Risk Management