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Tue 12 Jun 2018 09:06

Oil and fuel oil hedging market update


By the Oil Desk at Freight Investor Services.

Commentary

Brent closed last night at $76.46 with no change from Friday, and WTI closed at $66.10 up $0.36. Let's face it, it seems like OPEC's policy will more than likely change come 22nd June. 18 months of hard graft and - quite frankly - astounding compliance by all members has done its job and flat price is up at the dizzying heights of $76 per bbl. Something I'm not sure even the biggest of bulls would have envisaged. However, this compliance to the cuts has manifested itself into allowing other people into markets they previously weren't in - US oil heading to Asia for example - so the time has come for something to be done.

Fuel Oil Market (June 11)

The Crack ranged from -10.05 to -9.65 in a volatile day on the crack market with it closing at around - 9.80. Arbitrage spread rebounds from one-week low - The front-month East-West arbitrage spread today rebounded from a one-week low in the previous session as firm Middle East demand for fuel oil continued to eat into arbitrage supplies into Singapore, trade sources said. The 380 cSt fuel oil July arbitrage spread settled at $16 a tonne on Monday, up from a week low of $15.50 a tonne in the Friday. Meanwhile, weaker crude oil prices lent some support to the July 180 cSt fuel oil crack on Monday, which narrowed its discount to Brent crude by 14 cents a barrel from Friday to minus $5.66 a barrel.

Economic data/events (Times are London.)

* 1:30pm: U.S. CPI m/m for May

* 5pm: EIA's monthly Short-Term Crude Outlook report

* Trump meets Kim Jong Un, Singapore

* OPEC's monthly oil market report, including supply/demand forecasts and estimates

* Bloomberg-compiled Refinery Snapshot for U.S. and Canada; gives offline capacity projections for crude units and FCCs

* API issues weekly U.S. oil inventory report
Coral Energy vessel. Gasum publishes daily price for FuelEU Maritime compliance units  

Nordic energy company aims to enhance transparency in the evolving regulation compliance market.
Lady Clara vessel alongside Till Benelux vessel. Bunker Suite completes E-BDN trial aboard Lady Clara in Rotterdam  

Digital platform provider conducts electronic bunker delivery note trial with partners.
Chane Terminal Nieuwe Maas in Rotterdam. Peninsula expands biofuel capabilities in Rotterdam  

Marine fuel supplier adds 30,000 cbm capacity, with plans to expand to 110,000 cbm in early 2026.
Northern Europe map with the Finnish flag placed over Finland. ScanOcean launches physical bunker supply operations in Finland  

Swedish supplier expands into Finland with MGO and renewable fuels offerings.
Singapore Port viewed from The Pinnacle@Duxton. Singapore marine fuel sales dip 1.2% in October  

First YoY decline since February as sales of best-selling product fall despite bunker calls rising to second-highest level in port's history.
Daria Sukhanova, PMG Energies. PMG Energies appoints Daria Sukhanova as bunker trader  

Marine fuel business adds trader with over five years of experience to its team.
CMA CGM Salamanque vessel alongside Edison's Ravenna Knutsen vessel. CMA CGM and Edison complete Italy's first STS LNG bunkering for a boxship  

Ship-to-ship operation marks the first time LNG has been delivered to a container vessel in the Adriatic.
Simona Toma, Columbia Group. Columbia Group prioritizes LNG training to build seafarer competence  

Ship manager says LNG knowledge will form the foundation for working safely with future fuels.
Methanol fuel safety guidelines graphic. ClassNK updates methanol fuel guidelines as alcohol-fuelled ship orders rise  

Japanese classification society releases revised safety requirements for methyl and ethyl alcohol-fuelled vessels.
Island Oil Holdings logo. Island Oil seeks front office administrator in Limassol  

Cyprus-based bunker supplier and trader advertises role with benefits including provident fund.

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