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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 02 Feb 2018 09:22 GMT

Commentary

Brent closed last night up 0.76 to $69.65, WTI closed up 1.07 to $65.80. I've woken up this morning with that same fear you have when you have had a heavy night with your mates and you haven't yet spoken to your partner to figure out if you're in trouble or if you did anything wrong. Why do I have that fear? Well as soon as I mentioned my bet yesterday re crude hitting $85 per bbl, Goldman Sachs seemed to immediately then publish their forecast saying that it could very well get up to those kind of numbers. The more eagle-eyed of you were quick to point this fact out to me, so I very much appreciate that. I'm sure people are just waiting for the market to realize what it has done, correct by gapping down quite a few bucks and then people will see the wood for the trees. Brent and WTI are up over 50pct since June 2017 - 50 percent! The US dollar is at a three-year low and I'm pretty sure OPEC will come out soon saying they are happy with the cuts and both of these things will give Brent another boost.

Fuel Oil Market (February 1)

The front crack opened at -10.00, weakening to -10.65, -10.50, before weakening to -10.70. The Cal 19 was valued at -15.50.

Lower supplier offers for physical fuel oil cargoes boosted trade activity in the Singapore window on Thursday to its highest levels in more than a week, but weighed on fuel cash differentials. Cash premiums of 380 cSt fuel oil slipped for a second straight session to its lowest in more than one week on Thursday, while cash differentials of 180 cSt fuel oil flipped to a narrow discount after trading at a premium for more than a week.

Singapore weekly onshore fuel oil inventories rose 1% to a four-week high of 22.516 million barrels (about 3.36 million tonnes) in the week ended Jan. 31 despite fewer net imports. Net fuel oil imports into Singapore fell to 626,000 tonnes in the week to Jan. 31, down 41% from the week before, weighed down by higher fuel oil exports from the city-state which climbed to 681,000 tonnes, up 135% from a nine-week low seen in the week before.

Economic Data and Events

* 1:30pm: U.S. Change in non-Farm Payrolls, Jan.

* 1:30pm: U.S. Avg Hourly Earnings, Jan.

* 6pm: Baker Hughes rig count

* ~6pm: ICE weekly commitments of traders report for Brent, gasoil

* 8:30pm: Commodity Futures Trading Commission weekly scheduled report on futures and options positions

* 3pm: University of Michigan Sentiment, Jan. (final)

* Today, no exact timing:

** Bloomberg New Energy Finance Future of Mobility Summit in Palo Alto, final day

** Exxon Mobil 4Q earnings

** Platts Middle Distillates Conference in Antwerp, final day

** China Petroleum and Chemical Industry Association releases report on nation's 2017 & 2018 oil and petrochemical markets

Singapore 380 cSt

Mar18 - 383.75 / 385.75

Apr18 - 383.75 / 385.75

May18 - 383.50 / 385.50

Jun18 - 383.00 / 385.00

Jul18 - 382.00 / 384.00

Aug18 - 380.50 / 382.50

Q2-18 - 383.25 / 385.25

Q3-18 - 380.50 / 382.50

Q4-18 - 375.50 / 378.00

Q1-19 - 367.00 / 369.50

CAL19 - 329.75 / 332.75

CAL20 - 262.00 / 267.00

Singapore 180 cSt

Mar18 - 389.25 / 391.25

Apr18 - 389.50 / 391.50

May18 - 389.25 / 391.25

Jun18 - 389.00 / 391.00

Jul18 - 388.25 / 390.25

Aug18 - 386.75 / 388.75

Q2-18 - 389.25 / 391.25

Q3-18 - 387.00 / 389.00

Q4-18 - 382.25 / 384.75

Q1-19 - 375.25 / 377.75

CAL19 - 338.75 / 341.75

CAL20 - 272.75 / 277.75

Rotterdam Barges

Mar18 371.25 / 373.25

Apr18 371.25 / 373.25

May18 370.75 / 372.75

Jun18 370.00 / 372.00

Jul18 368.75 / 370.75

Aug18 - 366.75 / 368.75

Q2-18 370.50 / 372.50

Q3-18 365.50 / 367.50

Q4-18 356.25 / 358.75

Q1-19 345.75 / 348.25

CAL19 306.75 / 309.75

CAL20 241.75 / 246.75



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.






Related Links:

Oil and fuel oil hedging market update
Freight Investor Services Ltd.

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