Sign up
Log in Sign up
Thu 11 Jan 2018, 09:24 GMT

Oil and fuel oil hedging market update


By the Oil Desk at Freight Investor Services.

Commentary

Brent closed up $0.38 to $69.20, WTI closed at $63.57 up $0.61. So the EIA showed a draw on crude. Great. Five weeks of draws and the market sees this as a positive step that the market is rebalancing. Hold on there, Nessie. Since December 1st, we have seen draws on US crude of approx 34.155mn bbls. Wonderful. But, since December 1st, we have seen product builds (gasoline and dists) of 38.489mn bbls. !!!! Refineries are running at record levels and the crude isn't actually going anywhere! In fact, we have seen a net increase on crude and oil products of 4.334 mn bbls! I honestly just don't get it. How can these numbers be ignored? Let's add some other harsh realities that are being awkwardly ignored like when you see an ex in a supermarket you really, really don't want to speak to: Es Sider pipeline down - now fixed apparently. Forties pipeline went down - now fixed. US oil production at 10mn bpd and EIA predict it will be at 11mn bbls a day. Yet here we are, flirting with $70 per bbl. I need to get a job with the OPEC PR team. They know how to get things done.

Fuel Oil Market (January 10)

The front crack opened at -11.15, weakening to -11.40, strengthening to -10.95, ending -11.15. The Cal 19 was valued at -11.80.

Oil-Strong selling interest drags spreads and cracks lower. Concerns of ample prompt supplies of fuel oil coupled with sluggish demand saw selling pressure mount, sending time spreads and refining margins of Asian fuel oil lower albeit thin trading volumes as buyer stayed clear. Rising crude oil prices, which hit their highest in more than three years on Wednesday, also helped weigh on the frontmonth fuel oil crack, sending it to its lowest since November 2016.

Fujairah fuel oil inventories rose 5 percent, or 448,000 barrels (about 67,000 tonnes), from a week ago to a twoweek high of 9.074 million barrels (1.354 million tonnes)in the week ended Jan. 8.

India's fuel oil demand was 10.1 percent lower in December compared with the same month last year.

Economic Data and Events

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

* 1:30pm: U.S. Initial Jobless Claims, Jan. 6

* 1:30pm: U.S. Continuing Claims, Dec. 30

* 2:45pm: Bloomberg Consumer Comfort, Jan. 7

Singapore 380 cSt

Feb18 - 376.25 / 378.25

Mar18 - 376.75 / 378.75

Apr18 - 377.00 / 379.00

May18 - 377.00 / 379.00

Jun18 - 376.75 / 378.75

Jul18 - 376.25 / 378.25

Q2-18 - 376.75 / 378.75

Q3-18 - 375.25 / 377.25

Q4-18 - 371.50 / 374.00

Q1-19 - 364.50 / 367.00

CAL19 - 342.50 / 345.50

CAL20 - 291.00 / 296.00

Singapore 180 cSt

Feb18 - 380.75 / 382.75

Mar18 - 381.75 / 383.75

Apr18 - 382.00 / 384.00

May18 - 382.25 / 384.25

Jun18 - 382.00 / 384.00

Jul18 - 381.75 / 383.75

Q2-18 - 382.00 / 384.00

Q3-18 - 380.75 / 382.75

Q4-18 - 377.50 / 380.00

Q1-19 - 372.25 / 374.75

CAL19 - 351.00 / 354.00

CAL20 - 300.00 / 305.00

Rotterdam Barges

Feb18 364.00 / 366.00

Mar18 365.00 / 367.00

Apr18 365.75 / 367.75

May18 365.75 / 367.75

Jun18 365.50 / 367.50

Jul18 364.50 / 366.50

Q2-18 365.50 / 367.50

Q3-18 362.50 / 364.50

Q4-18 354.75 / 357.25

Q1-19 347.50 / 350.00

CAL19 322.00 / 325.00

CAL20 271.00 / 276.00

Bennett J. Pekkattil and Capt. Alok RC Sharma. TFG Marine calls for digital transformation to manage alternative fuel risks  

CFO says transparency and digital solutions are essential as the marine fuels sector faces volatility from diversification.
Mugardos Energy Terminal. Reganosa’s Mugardos terminal adds bio-LNG bunkering for ships and trucks  

Spanish facility obtains EU sustainability certification to supply renewable fuel with 92% lower emissions.
Global Ethanol Association (GEA) and Growth Energy logo side by side. Growth Energy joins Global Ethanol Association as new member  

US biofuel trade association represents nearly 100 biorefineries and over half of US ethanol production.
Bertha B vessel. H2SITE explains decision to establish Bergen subsidiary  

Ammonia-to-hydrogen technology firm says Norwegian city was obvious choice for its ambitions.
Vessel at sea under dark clouds. Gibraltar Port Authority issues severe weather warning for gale-force winds and heavy rain  

Port authority warns of storm-force gusts of up to 50 knots and rainfall totals reaching 120 mm.
Christiania Energy headquarters. Christiania Energy relocates headquarters within Odense Harbour  

Bunker firm moves to larger waterfront office to accommodate growing team and collaboration needs.
AiP award ceremony for 20K LNGBV design. HD Hyundai Heavy Industries receives design approval for 20,000-cbm LNG bunkering vessel  

Bureau Veritas grants approval in principle following joint development project with South Korean shipbuilder.
Lloyd’s Register technical committee meeting in Spain. Peninsula outlines dual role in FuelEU Maritime compliance at Lloyd’s Register panel  

Marine fuel supplier discusses challenges for shipowners and opportunities for suppliers under new regulation.
Current status of fleet fuel types chart. LNG-fuelled container ships dominate January alternative-fuel vessel orders  

Container ships accounted for 16 of 20 alternative-fuelled vessels ordered in January, DNV reports.
Rick Boom, CIMAC and Professor Lynn Loo, GCMD. GCMD and CIMAC sign partnership to advance alternative marine fuel readiness  

Two-year agreement aims to bridge operational experience with technical standards for decarbonisation solutions.




 Recommended