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By the Oil Desk at Freight Investor Services Ltd.

As we see the market flatline after the news that OPEC and the 11 non-OPEC producers have already cut 1.5 million bpd from the global oil market - over 80% of the pledged cut - it feel as though the continuing march of the US rig count is weighing on the minds of traders. When all the new rigs come into production, it could eliminate all the cuts that OPEC have managed to agree, and leave us in a situation similar to that of the end of last year. US oil production at current rig levels is estimated to increase 315,000 barrels, and the IEA has now cut the forecast for oil demand down to 1.3 million bpd from 1.5 million. So to fight between how much demand there will be and the amount of production increase of those outside the OPEC deal can make continues. The market seems happy around the $55 level until one side of this fight really starts to dominate.

Economic data/events (London times)

* ~12pm ICE weekly commitments of traders report for Brent, gasoil

* 2pm: China Conference Board Dec. Leading Economic Index

* 3pm: Eurozone consumer confidence for Jan. A, est. -4.8 (prior -5.1)

* Today: Middle East and North Africa Energy conference, Chatham House, London

Singapore 380 cSt

Feb17 - 319.50 / 321.50

Mar17 - 318.25 / 320.25

Apr17 - 317.25 / 319.25

May17 - 316.25 / 318.25

Jun17 - 315.25 / 317.25

Jul17 - 314.00 / 316.00

Q2-17 - 316.25 / 318.25

Q3-17 - 313.00 / 315.00

Q4-17 - 309.00 / 311.50

Q1-18 - 306.50 / 309.00

CAL18 - 302.25 / 305.75

CAL19 - 287.00 / 292.00

Singapore 180 cSt

Feb17 - 325.25 / 327.25

Mar17 - 324.00 / 326.00

Apr17 - 324.00 / 326.00

May17 - 323.00 / 325.00

Jun17 - 322.25 / 324.25

Jul17 - 321.00 / 323.00

Q2-17 - 323.25 / 325.25

Q3-17 - 320.00 / 322.00

Q4-17 - 316.25 / 318.75

Q1-18 - 314.00 / 316.50

CAL18 - 309.75 / 313.25

CAL19 - 295.75 / 300.75

Barges

Feb17 299.50 / 301.50

Mar17 300.50 / 302.50

Apr17 300.75 / 302.75

May17 300.50 / 302.50

Jun17 300.00 / 302.00

Jul17 299.00 / 301.00

Q2-17 300.25 / 302.25

Q3-17 298.00 / 300.00

Q4-17 293.25 / 295.75

Q1-18 292.50 / 295.00

CAL18 287.75 / 291.25

CAL19 272.25 / 277.25

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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.