Wed 25 Apr 2018, 09:03 GMT

Oil and fuel oil hedging market update


By the Oil Desk at Freight Investor Services.



Commentary

Brent closed last night down $0.02 to $73.86 and WTI closed at $67.70. As the oil market settles down again after another busy MPGC, the price of Brent seems to be settling down to and enjoying a $70 handle. It all went a bit nuts at one point, didn't it? I was really starting to believe that we'd break the $75.60 resistance and be on our way to the lofty $85 per bbl as the rally seemed relentless. I thought the market might react on the back of the Macron/ Trump meeting regarding Iran but, as with any news that isn't of a bullish nature, it is ignored in the same way your wife ignores you the whole day yesterday after a very late finish on Monday night. Awkward. It's Wednesday, so we all know what that means: EIA data. Apparently, we will see a build on crude and draws on everything else. I read yesterday that China are buying more crude oil than ever, but they also have more products to sell than ever. So, good for crude demand, but will flood the products market. Fixing one problem and then causing another. Anyway, watch Brent/WTI; it's trading -6.16 at time of writing and Cushing stocks later could blow it further... who knows.

Fuel Oil Market (April 24)

The front crack opened at -14.20, strengthening to -14.15, before weakening to -13.60, closing -14.30. The Cal 19 was valued at -17.10.

Asia's 380 cSt high-sulphur fuel oil market jumped on Tuesday on signs of tight finished grade supplies of the fuel after reports that some off-specification quantities of the fuel were circulating in the bunker fuels market on Monday. Cash premiums for 380 cSt soared to an 11- month high on Tuesday amid elevated deal values in the Singapore trading window, while the front-month time spread of the fuel jumped to its highest since October.

Spot ex-wharf premiums for 380 cSt fuel also surged to as high as $10 a tonne on Tuesday amid strong buying interest for the break-bulk cargoes of the fuel and limited supplier offers. With the Singapore fuel oil market already tightening over the past weeks amid rising seasonal demand for the fuel, the fuel oil market could sustain these elevated price levels for at least some weeks.

Economic Data and Events: (Times are London.)

* 3:30pm: EIA weekly oil inventory report; TopLive blog starts at 3:20pm

* CWC's China LNG and Gas International Summit in Beijing. Day one of two. Speakers include Exxon, Shell, Cnooc, CNPC, Cheniere Marketing, Petronas

* AIPN summit in London, final day

* Argus Marpol summit in Houston, final day

* Russia Urals preliminary loading plan for May

** See OIL WEEKLY AGENDA for this week's events

Singapore 380 cSt

May18 - 389.00 / 391.00

Jun18 - 387.00 / 389.00

Jul18 - 385.00 / 387.00

Aug18 - 382.75 / 384.75

Sep18 - 380.75 / 382.75

Oct18 - 378.25 / 380.25

Q3-18 - 382.75 / 384.75

Q4-18 - 375.75 / 377.75

Q1-19 - 366.75 / 369.25

Q2-19 - 359.50 / 362.00

CAL19 - 333.50 / 336.50

CAL20 - 268.00 / 273.00

Singapore 180 cSt

May18 - 398.75 / 400.75

Jun18 - 396.75 / 398.75

Jul18 - 395.00 / 397.00

Aug18 - 393.00 / 395.00

Sep18 - 391.00 / 393.00

Oct18 - 389.00 / 391.00

Q3-18 - 393.00 / 395.00

Q4-18 - 386.75 / 388.75

Q1-19 - 378.00 / 380.50

Q2-19 - 371.00 / 373.50

CAL19 - 348.00 / 351.00

CAL20 - 292.00 / 297.00

Rotterdam Barges

May18 - 374.25 / 376.25

Jun18 - 373.50 / 375.50

Jul18 - 371.75 / 373.75

Aug18 - 369.00 / 371.00

Sep18 - 365.75 / 367.75

Oct18 - 362.00 / 364.00

Q3-18 - 368.75 / 370.75

Q4-18 - 358.25 / 360.25

Q1-19 - 349.25 / 351.75

Q2-19 - 338.50 / 341.00

CAL19 - 313.50 / 316.50

CAL20 - 243.00 / 248.00

LNG  

Person signing a document. Venture Energy signs green methanol supply deal with Shenji Energy  

Hong Kong-based firm to purchase ISCC EU-certified biomass-derived methanol for shipping clients.

Steel cutting ceremony of vessel with builder's hull no. CHB2060. Changhong International begins construction on second 11,400-teu LNG dual-fuel container ship  

Chinese shipbuilder starts work on vessel CHB2060, second of 18-ship series for Oceanroutes.

Keel-laying ceremony of Celsius. Keel laid for LNG bunkering vessel Celsius  

Turkish shipbuilder begins construction of dual-fuel bunkering vessel for Sirius Shipping and Gasum.

Marine ISTA alongside MSC Apollo vessel. Vitol’s Marine ISTA completes record 4,900 mt bunkering operation at Karachi Port  

Operation marks largest fuel supply at Pakistani port, highlighting potential for regional bunkering hub development.

Aurora Botnia vessel. Gasum and Wasaline extend bio-LNG supply agreement to 2027  

Nordic energy company renews fuel supply contract with Finnish-Swedish ferry operator through 2027.

Luminara vessel truck-to-ship bunkering. MOL Techno-Trade completes Japan’s first truck-to-ship LNG bunkering for foreign cruise vessel  

Ritz-Carlton cruise ship Luminara refuelled at Nagasaki Port using truck-to-ship method on 3 April.

NKT Eleonora vessel cable-laying. Methanol-ready cable-laying vessel hull launched in Romania  

Shipbuilder floats hull of dual-fuel vessel designed for offshore renewable energy cable operations.

Dr Prapisala Thepsithar, GCMD. GCMD biofuels lead receives Singapore standardisation award  

Dr Prapisala Thepsithar recognised for contributions to marine biofuel specification development.

Marine Energy Wales (MEW) Conference 2026 graphic. Certas Energy to attend Marine Energy Wales conference in April  

Marine fuel supplier to discuss sector solutions at UK marine renewable energy conference.

Dinamo IV vessel. Sanmar completes sea trials for 14th all-electric tugboat  

Turkish shipyard marks half-century in business with latest battery-powered vessel from ElectRA series.