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 finished the day quasi unchanged despite weakening during the European morning session. The February WTI futures settled at $93.19/bbl, +$0.10 and Brent inched up $0.09 to $111.40/bbl. Market was trading sideways  after the initial euphoria from last week's  eleventh hour deal to avert a US fiscal cliff and also some positive economic data from China. Market is already looking forward to the next battle looming -as soon as Mid February -on increasing the debt ceiling. Yesterday, crude market managed to emerge marginally above parity despite declining equities and more cautious market ahead the US Corporate earnings season releases. Today, no much market mover in terms of data with only the November German Factory Orders. Tonight API weekly stocks number should weigh on Crude as some builds are expected. This morning, crude is trading slightly down.

Fueloil Specifics

The NWE fuel oil markets started the week on a positive note. Both delivered 380cst product in Rotterdam and cargo prices posted app.$2/mt gains versus last close. ARA ports reported increased buying activity. The Singapore markets dipped more app.$1.0 during the Platts window yesterday. Market fundamentals have turned firmer as market structure turn more towards backwardation. The delivered bunker premiums were seen in a range of $3.5-5.0 above cargo prices yesterday. Bunker fuel oil swaps gained app.$2/mt at the front and a dollar more that the backend of the forward curve. This morning both markets are trading slightly higher.

Settlement & Indications (mid values)

Product Yesterday's Values Forward Indications Product Change Last Dir. Feb Mar Apr Q213 Q313 2013 NYMEX WTI Swap (1st month) 0,10 93,19 ↓ 93,71 94,05 94,33 94,46 94,44 93,88 ICE Brent Swap (1st month) 0,09 111,40 ↓ 109,93 109,21 108,58 107,98 106,24 107,25 ICE Gasoil Swap (1st month) 10,00 938,50 ↑ 939,25 935,25 930,92 926,58 919,28 924,19 3.5% Barges FOB Rtdm 2,25 604,00 ↓ 602,75 602,25 602,00 601,50 598,75 599,50 3.5% Cargoes FOB Med 4,00 596,25 ↓ 596,00 596,50 595,50 595,75 593,75 593,75 1.0% Cargoes FOB NWE 8,00 626,50 ↓ 629,00 630,50 631,00 631,00 630,25 628,75 3% no. 6 USGC WB (0,26) 97,05 ↓ 97,05 96,05 95,55 94,80 94,30 94,80 380 CST Cargoes FOB S'pore (1,25) 627,75 ↓ 628,25 627,25 626,75 626,00 623,50 624,50 0.1 % GO Barges FOB Rtdm 10,25 937,25 ↑ 939,25 936,25 931,25 928,25 918,25 924,25 Physical Rotterdam 380 CST 2,00 607,00 ↓ 610,00 609,50 609,25 608,75 606,00 606,75 Physical Singapore 380 CST (1,00) 631,75 ↓ 635,50 634,50 634,00 633,25 630,75 631,75

Focus of the day: ARA

The past week has been quite strong in NWE with the hilo gaining strength and the crack changing so even with a lower Brent we still see higher market levels. Besides that the availability remains tight on all high sulphur products. Some suppliers and even a few majors do not have RMK500 in January which is why more RMG380 is being bunkered. Needless to say RMG380 is also very tight.

Economy fundamentals this week

Fundamental Indicators Statistic Importance Date Time Period Consensus Last Actual Consumer Credit Medium 08-jan 3:00 PM Nov $8.0B $14.2B - MBA Mortgage Index Medium 09-jan 7:00 AM 05-jan NA NA - Initial Claims Medium 10-jan 8:30 AM 05-jan 365K 372K - Wholesale Inventories Medium 10-jan 10:00 AM Nov 0.2% 0.6% - Trade Balance Medium 11-jan 8:30 AM Nov -$45.0B -$42.2B - Treasury Budget Medium 11-jan 2:00 PM Dec NA -$86.0B -

Source: OW Risk Management