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Commentary

Brent crude futures were at $69.79 a barrel at 07:49 GMT, down $17 cents from their last close. U.S. WTI crude futures were at $64.45 a barrel, down $2 cents from their last settlement. A little overnight fall in Brent prices caused by API figures showing a build in U.S. crude stocks, up 4.8 million. It's EIA day!! Don't get too excited, you may injure yourself. I almost did my back in lifting the bag of salt onto the desk ready for the 3.30pm figures. Interestingly, we have a divergence of opinion this morning on the desk between technical and market positions: Trading data shows open interest for Brent put options to sell at $70, $69 and $68 per barrel has surged since the middle of last week on the ICE. Yet technically we are pointing towards making new highs above $70.50. I guess that this explains why the market so far this morning has been as flat as a pancake. Shock factors are going to be the ones to send this market higher: Venezuela, North Korea, Trump, Brexit, Iraq and Turkey vs the Kurds. So to write a commentary on why oil should rise is a string of ifs and maybes, but they are certainly plausible. It's easier to write a bearish report: oooo its looking high, multi year highs, put positions gaining, U.S. stocks build... But like the first lemmings to jump off the cliff, you may have judged the impending fall too early and not realized that the back lemmings have stopped.

Fuel Oil Market (January 23)

The front crack opened at -11.25, weakening to -11.95 across the day. The Cal 19 was valued at -15.20.

Asia's February visco spread climbed to a near five-month high on Tuesday as some industry participants expected an apparent shortage in supplies of cutter stocks in the near term, sources said.

The firming visco spread, however, came amid limited trade activity with Open Interest levels for the February visco contract on the (ICE) totalling slightly lower than 690,000 tonnes while the March contract was at around 460,000 tonnes. At the start of the month, falling demand for low-viscosity fuel oil, particularly from Pakistan's utility sector, sent the front-month visco spread to its lowest in 1-1/2 years.

Meanwhile, sluggish demand and stiff competition are weighing on 380 cSt fuel oil ex-wharf premiums as suppliers continue to wait for an uptick in demand ahead of the Chinese new year holidays next month.

Economic Data and Events

* 12pm: U.S. MBA Mortgage Applications, Jan. 19, prior 4.1%

* 2:45pm: U.S. Markit Composite PMI, Jan. P, prior 54.1

* 3pm: U.S. U.S. Existing Home Sales, Dec., est. 5.70m, prior 5.81m

* 3:30pm: EIA issues weekly U.S. oil inventory report

* World Economic Forum, Davos, 2nd day of 4, click here for program

Singapore 380 cSt

Feb18 - 378.25 / 380.25

Mar18 - 378.00 / 380.00

Apr18 - 377.75 / 379.75

May18 - 377.50 / 379.50

Jun18 - 377.00 / 379.00

Jul18 - 376.00 / 378.00

Q2-18 - 377.50 / 379.50

Q3-18 - 374.25 / 376.25

Q4-18 - 368.50 / 371.00

Q1-19 - 361.00 / 363.50

CAL19 - 326.50 / 329.50

CAL20 - 270.25 / 275.25

Singapore 180 cSt

Feb18 - 384.00 / 386.00

Mar18 - 383.75 / 385.75

Apr18 - 384.00 / 386.00

May18 - 383.75 / 385.75

Jun18 - 383.25 / 385.25

Jul18 - 382.25 / 384.25

Q2-18 - 383.50 / 385.50

Q3-18 - 380.25 / 382.25

Q4-18 - 374.50 / 377.00

Q1-19 - 367.00 / 369.50

CAL19 - 334.50 / 337.50

CAL20 - 279.50 / 284.50

Rotterdam Barges

Feb18 365.00 / 367.00

Mar18 365.75 / 367.75

Apr18 365.75 / 367.75

May18 365.00 / 367.00

Jun18 364.00 / 366.00

Jul18 362.50 / 364.50

Q2-18 365.00 / 367.00

Q3-18 360.25 / 362.25

Q4-18 350.75 / 353.25

Q1-19 342.75 / 345.25

CAL19 306.00 / 309.00

CAL20 249.00 / 254.00