Oil and fuel oil hedging market update

Commentary

Brent closed last night down $0.36 to $63.16 and WTI closed at $56.76, up $0.02. It's getting to that great time of year over in Dubai. This week they have the air show, the motor show, the Race to Dubai golf and next week we have the Grand Prix in Abu Dhabi. But all that is on everyone's mind is not watching Lewis Hamilton parade around Yas Marina. No, no, no. Everyone is waiting for the OPEC meeting in Vienna at the end of November. To be honest, I don't know why they don't just hold the OPEC meeting in the Viceroy Yas Island next Sunday, because I'm pretty sure every OPEC minister would be there anyway. That would be great, wouldn't it? Instead of those pit workers holding up how many laps have gone they could hold up signs that say "Cuts are extended", or whatever they decide. Bring OPEC to the masses! It's inevitable that those who drove the market up regardless of the fundamentals will be the ones who take profits and sell it off at some point, but will they really do it before the OPEC meeting? If they extend the cut and we fly up again, they are going to have a lot of egg on their face. Or will they deliberately sell it off beforehand, to then buy it up again on the bullish headlines coming from panicking OPEC ministers at the meeting? I'm inclined to go with the latter scenario - the bullish play of OPEC has already been evidenced with yesterday OPEC once again increasing its demand forecast. Wasn't it only last week that they conceded that demand actually won't be that high? API data out later tonight so watch crude with caution.

Fuel Oil Market (November 13)

The front crack opened at -7.80, strengthening to -7.75, before weakening to -8.00. The Cal 18 was valued at -7.75.

Cash premiums of Asia's 380 cSt high-sulphur fuel oil edged higher on Monday, snapping four straight sessions of declines as deal values in the Singapore window improved, sources said

Meanwhile, in the paper markets, activity was muted at the start of the week, leaving the prompt-month time spreads, arbitrage spreads and fuel oil cracks largely unchanged. Singapore's marine fuel sales fell to a fourmonth low of 4.005 mil tns in October, down 7.7% from September, but were largely unchanged compared with the same period a year ago.

The October quantities are the third-lowest volumes for 2017 ahead of the June and February volumes. In October 2016, a total of 4.009 million tonnes of bunker fuels were sold in Singapore.

Economic Data/Events: (UK times)

* 9am: IEA's monthly oil market report

* 9:30am: Oct. U.K. Consumer Price Index m/m est. 0.2% (prior 0.3%) and y/y est. 3.1% (prior 3%)

* 11am: U.S. NFIB Small Business Optimism. Oct.

* 1:30pm: U.S. PPI Final Demand, Oct.

* Today:

** API issues weekly U.S. oil inventory report

** Bloomberg-compiled refinery snapshot, looking at key outages at refineries in the U.S. and Canada, and providing offline capacity projections for crude units and FCCs

Singapore 380 cSt

Dec17 - 366.50 / 368.50

Jan18 - 365.25 / 367.25

Feb18 - 363.75 / 365.75

Mar18 - 362.25 / 364.25

Apr18 - 360.75 / 362.75

May18 - 359.25 / 361.25

Q1-18 - 363.75 / 365.75

Q2-18 - 359.25 / 361.25

Q3-18 - 353.75 / 356.25

Q4-18 -348.50 / 351.00

CAL18 - 359.00 / 362.00

CAL19 - 321.50 / 326.50

Singapore 180 cSt

Dec17 - 370.75 / 372.75

Jan18 - 370.25 / 372.25

Feb18 - 369.25 / 371.25

Mar18 - 368.25 / 370.25

Apr18 - 367.00 / 369.00

May18 - 366.00 / 368.00

Q1-18 - 369.25 / 371.25

Q2-18 - 365.50 / 367.50

Q3-18 - 360.50 / 363.00

Q4-18 - 355.25 / 357.75

CAL18 - 365.25 / 368.25

CAL19 - 330.25 / 335.25

Rotterdam 380 cSt

Dec17 347.75 / 349.75

Jan18 346.75 / 348.75

Feb18 346.00 / 348.00

Mar18 345.25 / 347.25

Apr18 344.25 / 346.25

May18 343.25 / 345.25

Q1-18 346.00 / 348.00

Q2-18 343.25 / 345.25

Q3-18 337.75 / 340.25

Q4-18 329.25 / 331.75

CAL18 341.25 / 344.25

CAL19 299.25 / 304.25


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		Jumbo orders two methanol-ready L-Class heavy lift vessels from Dajin Heavy Industry Dutch heavy lift specialist Jumbo signs newbuilding contract for two 25,000-dwt vessels.

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		Port of Long Beach launches $1m methanol bunkering challenge for oceangoing vessels A $1m prize aims to kick-start commercial methanol bunkering at one of North America's busiest ports.

		Greece floating nuclear study finds no fundamental barriers to implementation A PESTLE assessment of floating nuclear power plants in Greece identifies framework gaps, not feasibility barriers.

		Molgas completes LNG cool-down and bunkering for Northern Pathliner at Northern Lights terminal in Norway Operation carried out at Øygarden facility, with K Line and Integr8 Fuels in the supply chain.

		G2 Ocean expands fleet with six future-fuel ready gantry crane vessels Open hatch specialist adds vessels and jet sail technology as part of a broad fleet renewal programme.

		LNG-powered CMA CGM Adventure makes first call at the Port of Mombasa Kenya Ports Authority receives its first large LNG-fuelled container vessel.

		Maritime trio shapes IMO safety guidelines for ammonia as marine fuel Real-world operational experience feeds directly into new IMO ammonia fuel safety framework.

Oil and fuel oil hedging market update

By the Oil Desk at Freight Investor Services.

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