FIS Makes Bunker Swaps Simple

(Press Release)
Wednesday, March 07, 2012

London - Freight Investor Services has expanded its rapidly growing commodity broking business into cleared, over-the-counter bunker swaps. The new service – the Fuel Oil Single Swap (FOSS) - comes in response to escalating bunker prices, which are hurting shipowner margins at a time of historically low freight rates.
The new FIS offering will include three fuel oil contracts: Singapore 380 centistokes (CST), Singapore 180 CST and Rotterdam 3.5% sulphur barges FOB. In contrast to existing swaps, these contracts will be traded in lot sizes of just one tonne, enabling easier access to these markets for smaller players such as shipowners who need to manage their fuel cost risk for small fleets or even individual vessels.
This new pool of liquidity should attract players from across the bunker sector, including suppliers and traders as well as funds and banks.
The price of Singapore 380 CST bunkers stands $40/t higher than at the start of 2012. A typical Capesize vessel on a 45-day voyage can consume 2,500 tonnes of fuel, costing over $100,000 more today than just two months ago. By hedging that price risk shipowners and operators can protect themselves more effectively than leaving themselves at the mercy of the spot market.
“With some of the lowest freight rates of the past 20 years across all the shipping sectors - including dry bulk, tanker and container markets – and some of the highest bunker prices on record, fuel oil can account for as much as 70% of vessel running costs,” said John Banaszkiewicz, FIS Managing Director. “This needs to be traded and managed. FIS is delighted to offer this innovative broking service where size does not matter. Any counterparty, whatever their size, can trade as many or as few bunker swaps as they want. Added to this, the three bunker swaps will be available in real-time, with live prices posted on FIS’ free multi-commodity trading screen, making them even simpler and easier to trade.”
The swaps will be listed for clearing by SGX and NOS and consist of a single tonne, cash-settled swap contract based on the Platts daily assessment price of the main index, tradable up to four years forward.
 

Maritime Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter February 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

IBIA Celebrates 23th Annual Dinner

Association appoints new board members and sets priorities for the future   The International Bunker Industry Association (IBIA) has appointed three new members

OSV Delivered to MC2 in Dubai

Marine Core & Charter LLC (MC2) headquartered in Dubai has taken delivery of the new build PETRA-1, the first of two, 45-meter Fast Offshore Support Vessels in

Baltic Index Pauses at Record Low

The Baltic Exchange's main sea freight index, tracking rates for ships carrying dry bulk commodities, ended flat on Thursday after declining for 12 straight sessions

Finance

Baltic Index Pauses at Record Low

The Baltic Exchange's main sea freight index, tracking rates for ships carrying dry bulk commodities, ended flat on Thursday after declining for 12 straight sessions

Long Beach Sees Robust Container Growth

The Port of Long Beach kicked off 2016 by logging its seventh straight month of cargo increases, showing a 24.8 percent jump in container shipments over the same month last year.

Maersk Drilling Posts Record Profit

Maersk Drilling delivered the best result ever with a profit of USD 751m (USD 478m) in 2015 generating a ROIC of 9.3% (7.1%). The result was positively impacted

Fuels & Lubes

IBIA Celebrates 23th Annual Dinner

Association appoints new board members and sets priorities for the future   The International Bunker Industry Association (IBIA) has appointed three new members

The Next Generation of Hull Performance Management

Hull performance monitoring solutions can offer significant fuel savings potential, a fact that is prompting growing interest from the maritime industry. To spur

GTT, DSME Partner for NO96 Max Development

GTT signs a cooperation agreement with Daewoo Shipbuilding & Marine Engineering aiming at the industrialization of its NO96 Max technology   GTT, a designer of

 
 
Maritime Contracts Maritime Security Maritime Standards Navigation Offshore Oil Pod Propulsion Port Authority Ship Electronics Shipbuilding / Vessel Construction Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1067 sec (9 req/sec)