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BUNKER INDEX :: Price Index, News and Directory Information for the Marine Fuel Industry
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Oil and fuel oil hedging market update

14 Sep 2017 08:22 GMT

By the Oil Desk at Freight Investor Services.



By the Oil Desk at Freight Investor Services Ltd.

Brent closed up 0.89 last night to $55.16 and WTI closed at $49.30 up 1.07. So EIA stats were pretty much as people should have assumed they would be, albeit gasoline draws were high, the most since records began in fact. However, the market decided to react to EIA numbers with the same happiness as every Tottenham fan did that they finally won at Wembley!! Up we went. This set of data from EIA was only driven by the effects of Hurricane Harvey; it has no bearing on where demand is going to be coming into Q4 and, in fact, US production ROSE last week. Plus stocks at Cushing were up. The only reason for the rally can be because refinery runs were so low, but most of the majors are restarting them, so perhaps there will be more demand for some of the North Seas finest black stuff. It looks to me like the US is producing, and has enough in storage to meet the increased demand from the refineries restarting, so I see this as a false dawn for a further spike in Brent. Here's an interesting fact for you: Barbie's full name is Barbara Millicent Roberts. No, seriously, here's a fact for you: In Aug 2007 OPEC production was 30.3 mn bpd approx, Aug 2007 Brent was $77.40 per bbl. In Aug 2017, OPEC production was 32.76mn bpd, Aug 2017 Brent was $52.38. Aug 2007 US oil production was 5.07mn bpd, Aug 2007 WTI was $74.04. Aug 2017 US production was 9.5 mn bpd, Aug WTI was $47.23. Once again, I think the market is blatantly ignoring the facts in the same way that a best man ignores the fact he has a speech to write until the morning of a wedding. On the back of a soggy beer mat. Whilst they may seem like usual boring stats, we all see every day those numbers speak for themselves. OPEC production has risen by around 10% but flat price has dropped close to a third. US production has risen by close to 50pct and flat price has dropped close to a third. Does anyone hear the US crying about cutting production to raise oil prices? The game is changing, and changing fast. All eyes on the USA for a while to come methinks.

Economic Data/Events: (UK times)

* 9am: Singapore onshore oil-product stockpile data

* 9am: Italy CPI EU harmonized y/y for Aug.

* ~12pm: Russia refining maintenance schedule from ministry

* 12pm: U.K. Bank of England bank rate for Sept. 14

* 1:30pm: U.S.

* 2pm: Russia gold and forex reserve for week ended Sept. 8

* ~2pm: U.S. Climate Prediction Center expected to release monthly El Nino/La Nina forecast

* 3pm: U.S. EIA releases International Energy Outlook 2017 at CSIS, Washington, D.C.

* No exact timing

** Pareto Oil and Offshore Conference, Oslo, final day

Singapore 380 cSt

Oct17 - 324.25 / 326.25

Nov17 - 322.00 / 324.00

Dec17 - 319.75 / 321.75

Jan18 - 317.75 / 319.75

Feb18 - 316.25 / 318.25

Mar18 - 315.50 / 317.50

Q4-17 - 322.00 / 324.00

Q1-18 - 316.50 / 318.50

Q2-18 - 314.25 / 316.75

Q3-18 - 312.50 / 315.00

CAL18 - 312.00 / 315.50

CAL19 - 305.25 / 310.25

CAL20 - 287.25 / 294.25

Singapore 180 cSt

Oct17 - 329.00 / 331.00

Nov17 - 327.50 / 329.50

Dec17 - 325.50 / 327.50

Jan18 - 323.75 / 325.75

Feb18 - 322.75 / 324.75

Mar18 - 322.25 / 324.25

Q4-17 - 327.25 / 329.25

Q1-18 - 323.00 / 325.00

Q2-18 - 320.75 / 323.25

Q3-18 - 319.75 / 322.25

CAL18 - 319.25 / 322.75

CAL19 - 314.00 / 319.00

CAL20 - 296.25 / 303.25

Rotterdam 380 cSt

Oct17 308.75 / 310.75

Nov17 303.75 / 305.75

Dec17 300.25 / 302.25

Jan18 300.25 / 302.25

Feb18 300.25 / 302.25

Mar18 300.00 / 302.00

Q4-17 304.25 / 306.25

Q1-18 300.50 / 302.50

Q2-18 300.00 / 302.50

Q3-18 299.00 / 301.50

CAL18 296.25 / 299.75

CAL19 287.00 / 292.00

CAL20 269.25 / 276.25



Founded in 2002, Freight Investor Services is a specialist in dry bulk and commodity derivatives, including cargo freight, iron ore, fertilizer and bunker fuel. The company has offices in London, Dubai, Singapore and Shanghai.

For further details about fuel oil swaps or to discuss trading opportunities, please contact Andrew Cullen, Client Relations & Development Manager, on +44 207 090 1126, or email AndrewC@freightinvestor.com.


Image: Freight Investor Services (FIS) logo. Image credit: Freight Investor Services (FIS)




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