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Tue 9 Oct 2018, 09:10 GMT

Oil and fuel oil hedging market update


By the Oil Desk at Freight Investor Services.

Image credit: Freight Investor Services (FIS)
Commentary

Brent crude was up 45 cents, or 0.5 percent, at $84.36 a barrel by 06:29 GMT, having fallen as low as $82.66 in the previous session before largely recovering. Brent hit a four-year high of $86.74 last week, and U.S. WTI crude futures rose 41 cents, or 0.5 percent, to $74.70 a barrel. Shock horror, Iran exports are down. Latest figures putting it at 1.1 million barrels per day, down from 2.5 million barrels a day in April. Conveniently, there is also the news of a partial shutdown of operations in the Gulf of Mexico with a new storm bearing down upon the region. And if that wasn't enough to have the bulls elatedly firing champagne corks everywhere, technically we are also bullish with the 50, 100, and 200 period moving averages moving upwards. The reaction of the market this morning has been pretty strong - not just on crude, but also on cracks and EW. The mantra at the moment is when an unstoppable force meets a very moveable object - and I wish the moveable object the very best - it's not going to end well. Good day.

Fuel Oil Market (Oct 08)

The front crack opened at -10.15, weakening to -10.20, before strengthening to -9.70, closing -9.75. The Cal 19 was valued at -15.05.

Cash premiums for spot cargoes of 380 cSt high-sulphur fuel oil (HSFO) slipped on Monday amid weaker deal values in the Singapore physical trading window but the market was still supported by relatively tight availabilities of prompt cargoes, trade sources said.

Premiums for 380 cSt cargoes slipped to a three-session low of $5.97 a tonne to Singapore quotes on Monday, down from a more than two-month high of $6.27 a tonne on Friday.

Economic data/events (Times are UK)

* 11am: U.S. NFIB Small Business Optimism, Sept.

* S&P Global Platts North American Crude Oil Exports Summit, Houston

* Basra Mega Projects conference, Istanbul, 1st day of 2

* Oil & Money conference starts in London, 1st day of 3, with Qatar Petroleum CEO Saad Al Kaabi, Shell CEO Ben van Beurden, Total CEO Patrick Pouyanne, IEA Executive Director Fatih Birol, among others

Singapore 380 cSt

Nov18 - 501.50 / 503.50

Dec18 - 495.25 / 497.25

Jan19 - 488.75 / 490.75

Feb19 - 482.75 / 484.75

Mar19 - 477.25 / 479.25

Apr19 - 471.75 / 473.75

Q1-19 - 483.00 / 485.00

Q2-19 - 466.75 / 468.75

Q3-19 - 445.00 / 447.50

Q4-19 - 407.50 / 410.00

CAL19 - 446.00 / 449.00

CAL20 - 372.50 / 378.50

Singapore 180 cSt

Nov18 - 508.25 / 510.25

Dec18 - 503.00 / 505.00

Jan19 - 498.50 / 500.50

Feb19 - 493.00 / 495.00

Mar19 - 487.75 / 489.75

Apr19 - 483.00 / 485.00

Q1-19 - 493.00 / 495.00

Q2-19 - 478.75 / 480.75

Q3-19 - 459.75 / 462.25

Q4-19 - 428.50 / 431.00

CAL19 - 460.00 / 463.00

CAL20 - 394.00 / 400.00

Rotterdam 3.5%

Nov18 - 471.75 / 473.75

Dec18 - 466.00 / 468.00

Jan19 - 461.75 / 463.75

Feb19 - 457.75 / 459.75

Mar19 - 453.75 / 455.75

Apr19 - 449.50 / 451.50

Q1-19 - 457.75 / 459.75

Q2-19 - 444.50 / 446.50

Q3-19 - 421.25 / 423.75

Q4-19 - 381.25 / 383.75

CAL19 - 422.00 / 425.00

CAL20 - 353.25 / 359.25

Areion vessel. Dorian LPG takes delivery of dual-fuel VLGC capable of carrying ammonia  

The 93,000-cbm Areion can run on LPG or fuel oil and transport ammonia cargoes.
FSRU Toscana alongside Green Zeebrugge vessel. RINA awards ISCC EU certification to OLT Offshore LNG Toscana for bio-LNG supply  

Certification enables bio-LNG use in the EU as a renewable fuel under RED II and RED III directives.
World Shipping Council at IMO meeting. WSC calls for safe maritime corridor as 20,000 seafarers remain trapped in the Persian Gulf  

Industry body urges IMO member states to establish safe passage and supply access.
Graphic promoting Auramarine webinar titled 'Sustainable Fueling Part 3: Ammonia - next alternative fuel in marine'. Auramarine to host webinar on ammonia as marine fuel in April  

Finnish firm will explore ammonia’s role in maritime decarbonisation at its third spring webinar.
Front cover of study by WinGD and Envision Energy titled 'Renewable Fuel Economics: An OPEX illustration based on current costs'. Green ammonia could reach cost parity with VLSFO and LNG by 2050, study finds  

WinGD and Envision Energy study projects green ammonia operational costs competitive with conventional marine fuels.
Elenger Marine's LNG bunkering vessel Optimus alongside Brittany Ferries’ Saint-Malo. Bureau Veritas verifies methane emissions on Brittany Ferries’ LNG vessels  

Verification enables ferry operator to report measured methane slip instead of regulatory default values.
Map showing existing and planned Emission Control Areas (ECAs). Alliance calls for urgent black carbon action as new Arctic emission control areas take effect  

Canadian Arctic and Norwegian Sea ECAs now in force, with compliance deadline set for March 2027.
Artistic impression of battery-electric ferry for operation on Perth’s Swan River. Lloyd’s Register to class Western Australia’s first electric ferry fleet  

Echo Marine Group partners with Lloyd’s Register on five battery-electric ferries for Perth’s Swan River.
Thomas Kazakos, secretary general of The International Chamber of Shipping (ICS). ICS condemns Middle East shipping attacks as 20,000 seafarers remain trapped  

Industry body calls for urgent state action to resupply vessels and enable crew changes.
Molslinjen ferry illustration. Molslinjen order propels Australia to top of battery vessel production rankings  

Danish ferry operator’s three-catamaran order at Incat Tasmania shifts global manufacturing landscape, analysis shows.




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