Image credit: Freight Investor Services (FIS)

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Commentary

Brent crude futures climbed 64 cents, or 0.8 percent, to $77.46 a barrel and U.S. WTI crude futures were at $68.23 per barrel at 06:40 GMT, up 48 cents, or 0.7 percent, from their last settlement. If this oil market were a person, it would be a person who check their hand after shaking yours and where the last time you saw them spend a fiver it had their name signed on it. A tight market is the talk of the morning. As the major Iranian oil buyers cool off on transactions with the Middle Eastern country, it therefore follows the numerous stories of a supply shortfall, and put this together with a reduction in U.S. oil rigs, wooooosh up we fly this morning. Throw in the violence in Iraq and you have a bullish player's dream. All we need now is North Korea to renege on its deal and good peace progress and you are going to be sitting in your chair blinking in disbelief at your Brent price feeds. It seems that there is only so much U.S. oil that can be produced to fill the boots of the above problems, but like the stopping distance of a VLCC, you need plenty of foresight in this market to get your supply and demand to match up nicely - and there is no foresight in this market. Good day.

Fuel Oil Market (Sep 07)

Cracks bounce back after steep losses trading at -11.35. The front-month 380 cSt barge crack bounced back today after steep losses that started in mid-August as declining peak summer demand was set to ease supply tightness. "The fuel oil weakness is overdone," believing the fuel oil crack had bottomed out. The October 380 cSt barge crack to Brent crude was trading at minus $11.20 a barrel on Friday, up from about minus $12.15 a barrel in the previous session, broker sources said. The front-month barge crack sank to a more than three-month low of minus $12.08 a barrel on Wednesday. On Aug. 1, the front month barge crack was at a more than 10-month high of minus $6.84 a barrel.

Economic data/events (Times are London.)

* 1:30 pm Bloomberg forecast of U.S. waterborne LPG exports

* Azeri BTC Blend loading schedule for October

* Bloomberg proprietary forecast of Cushing crude inventory change, plus weekly analyst survey of crude, gasoline, distillate inventories before Wednesday's EIA weekly inventory report

Singapore 380 cSt

Oct18 - 438.25 / 440.25

Nov18 - 434.25 / 436.25

Dec18 - 430.75 / 432.75

Jan19 - 427.00 / 429.00

Feb19 - 423.50 / 425.50

Mar19 - 420.00 / 422.00

Q4-18 - 434.50 / 436.50

Q1-19 - 424.00 / 426.00

Q2-19 - 413.75 / 416.25

Q3-19 - 398.25 / 400.75

CAL19 - 398.00 / 401.00

CAL20 - 330.00 / 336.00

Singapore 180 cSt

Oct18 - 444.75 / 446.75

Nov18 - 442.00 / 444.00

Dec18 - 440.00 / 442.00

Jan19 - 437.25 / 439.25

Feb19 - 434.00 / 436.00

Mar19 - 430.75 / 432.75

Q4-18 - 442.25 / 444.25

Q1-19 - 434.00 / 436.00

Q2-19 - 425.25 / 427.75

Q3-19 - 413.25 / 415.75

CAL19 - 412.50 / 415.50

CAL20 - 353.00 / 359.00

Rotterdam 3.5%

Oct18 - 416.75 / 418.75

Nov18 - 412.50 / 414.50

Dec18 - 409.00 / 411.00

Jan19 - 406.50 / 408.50

Feb19 - 404.00 / 406.00

Mar19 - 401.50 / 403.50

Q4-18 - 412.75 / 414.75

Q1-19 - 403.75 / 405.75

Q2-19 - 394.75 / 397.25

Q3-19 - 376.50 / 379.00

CAL19 - 377.50 / 380.50

CAL20 - 317.50 / 323.50