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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

By the Oil Desk at Freight Investor Services.



Image credit:


Updated on 11 May 2018 08:22 GMT

Commentary

Brent closed last night up $0.26 to $77.47 and WTI closed at $71.36, up $0.22. What has the week brought us this time? Only one thing is really on everybody's mind this week and that is that the US have reimposed sanctions on Iran. I know previous assessments of the market had said that the premium for this had already been priced into crude, but the confirmation of it should have had a more aggressively bullish effect on the market. In reality, it was greeted with relative indifference. We read this morning that someone has said that OPEC "has the capacity to replace the Iranian losses", but warned that "even if physical supply is held constant... the market will still be faced with a precariously low level of spare capacity." It's going to be more of a competition with the U.S./Saudis/Russia to fill in for Iran. I hope people took my idea last year of investing in U.S. shale; they must be making a killing! I'll invoice you my consultancy fee. I wish you all a smashing weekend.

Fuel Oil Market (May 10)

The front crack opened at -12.65, strengthening to -12.40, before weakening to -12.50. The Cal 19 was valued at -17.00.

The front-month fuel oil crack continued to find support on Thursday despite further gains in crude oil prices. The June 380 cSt fuel oil crack to Brent crude was trading at a discount of about $12.40 a barrel while Brent was at $77.53 a barrel, the broker said. On Wednesday, the June crack was trading at about $12.50 a barrel. Meanwhile, the June viscosity spread fell for a sixth session straight to a five-week low of $9 a tonne. Trade sources said the availability of cutter stocks used to blend down the ample supplies of high-viscosity, high-density fuel oil in Singapore was gradually improving but the imbalance had not yet normalised. Singapore weekly onshore fuel oil inventories rose 8 percent, or 1.396 million barrels (about 208,000 tonnes), to a four-week high of 19.125 million barrels (2.854 million tonnes) in the week ended May 9.

Economic Data and Events: (Times are London.)

* 4pm: IEA monthly Oil Market Report

* China's General Administration of Customs releases preliminary commodity & energy trade data for March - including crude oil

* May 12:

* 1am: Baker Hughes rig count

* 1:30am: ICE weekly commitments of traders report for Brent, gasoil

* 3:30am: CFTC weekly commitments of traders report on various U.S. futures and options contracts

Singapore 380 cSt

Jun18 - 425.50 / 427.50

Jul18 - 422.75 / 424.75

Aug18 - 419.75 / 421.75

Sep18 - 416.50 / 418.50

Oct18 - 413.00 / 415.00

Nov18 - 409.75 / 411.75

Q3-18 - 419.75 / 421.75

Q4-18 - 410.00 / 412.00

Q1-19 - 398.50 / 401.00

Q2-19 - 388.00 / 390.50

CAL19 - 363.50 / 366.50

CAL20 - 298.00 / 303.00

Singapore 180 cSt

Jun18 - 434.75 / 436.75

Jul18 - 432.50 / 434.50

Aug18 - 429.75 / 431.75

Sep18 - 426.75 / 428.75

Oct18 - 423.50 / 425.50

Nov18 - 420.25 / 422.25

Q3-18 - 429.75 / 431.75

Q4-18 - 420.50 / 422.50

Q1-19 - 409.50 / 412.00

Q2-19 - 399.25 / 401.75

CAL19 - 378.00 / 381.00

CAL20 - 322.00 / 327.00

Rotterdam Barges

Jun18 - 411.25 / 413.25

Jul18 - 408.50 / 410.50

Aug18 - 405.00 / 407.00

Sep18 - 401.00 / 403.00

Oct18 - 396.75 / 398.75

Nov18 - 392.50 / 394.50

Q3-18 - 405.00 / 407.00

Q4-18 - 392.50 / 394.50

Q1-19 - 380.50 / 383.00

Q2-19 - 366.50 / 369.00

CAL19 - 342.00 / 345.00

CAL20 - 273.00 / 278.00



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 call +44 20 7090 1120, or email info@freightinvestor.com.






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