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After initial tests of first resistances, oil futures’ upside at ICE and NYMEX remains limited. Investors are cautious prior to the release of the DoE data on U.S. oil inventories. Given official estimations and the API report, the DoE data are expected to be rather bearish. The ECB decision on its interest rate scheduled for tomorrow adds to traders’ “wait-and-see” position. The economic data released this morning (EU GDP, German industrial production) failed to really stimulate the market. As expected, the EU’s economic performance has slightly declined while German industrial production fell short of expectations but at least, the figures were far better than in the previous month. The EIA monthly report also included a bearish element. The oil market started with a fundamentally bearish tendency Tuesday morning, having hardly changed but retreating slightly. Towards afternoon, oil prices turned around and tested their upward potential. Due to expanding capacities of the Seaway Pipeline in the USA, some traders cut more spread bets while U.S. refineries in the South increasingly supply their needs of WTI futures as the high inventories inland are becoming more accessible. But rebalancing two of the most important commodity indices, S&P GCSI and DJ/UBS had a bullish effect on oil futures. Consequently, Brent will account for a greater share in the indices' mix, resulting in shifting investment capital and other assets to the oil market. The breach of first resistance lines triggered technical buying orders which accelerated the price hike. Only around the resistances at 950.00 dollars G.Oil, 112.45 dollars Brent and 93.90 dollars WTI did buying interest wind down. Bouncing off these marks favoured profit-taking since it only has a one-time effect when traders reposition their futures after indices have been rebalanced. In addition, U.S. inventories are also expected to be bearish this week. NYMEX futures WTI and gasoline were softer than Brent and G.Oil at ICE in face of the expected bearish inventory data in the late evening. The API data released at night confirmed expectations of a build in inventories in all categories and they were even higher than expected in terms of products and crude.

ICE Gasoil contract for January delivery settled at 945.25 dollars on Tuesday. This was 6.75 dollars above Monday's settlement. With some 44,000 deals the traded volume was slightly below average.

The stochastic oscillator as well as the RSI are not giving off any clear signs this morning. Upward trend channels for WTI and Brent have proved to be very strong so far and may continue to limit downward potential in the course of the day. Thus prices will probably consolidate sideways at a high level. A breach of support lines, however, could trigger a severe technical reaction.

U.S.

Nymex Access bearish: Prices have hardly changed in electronic trading. Futures consolidate near yesterday's closing prices and do not show any clear tendency. While the API report weighed on prices last night, the reviving Asian stock market and the slightly recovered euro support. Trading interest at ICE and NYMEX is about average for this time of day. Market participants are waiting for the European market to open, for the upcoming economic data, and for the DoE data to be released at 4.30 p.m. today.

API's: Crude oil +2.4; distillates +5.9; gasoline +7.9 million barrels vs previous week. Refinery utilization -1.6%
DOE's; due out tonight
Forecasts: Crude oil +1.6; distillates +1.6; gasoline +1.4 million barrels vs previous week

Houston (ex-wharf indications 08-01)
380cst $638
180cst $687
MGO $1013
New Orleans (ex-wharf indications 08-01)
380cst $653
180cst $698
MGO $1008

Singapore (correct as of 1430hrs LT - delivered indications)

WTI is stable still with +$0.16. Paper for Jan are slightly more bullish, gaining with 180cst +$2.15 and for 380cst +$2.15 , Feb contracts are gaining as well with 180cst +$3.25, 380st +$4.05. The cargo market is starting to react to crude and paper with 180cst +$0.38, 380cst +$0.70 and MGO +$0.82.

The Singapore markets managed to inch marginally up around flat to +$1.0 during the Platts window yesterday. The previous day's strength in buying interest dipped as players saw the strength as a temporary driven by European tightness previously. The delivered bunker premiums were firmer, between $5.5-7.0 above cargo prices. This morning markets are trading higher.

High premiums for prompt deliveries.
380 cst $632
180 cst $637
MDO $945

ARA (Amsterdam - Rotterdam - Antwerp)

In general there are good stocks of products and availability of barges reported. This is the same for Antwerp and Rotterdam.

Indications for delivered bunkers:
380cst : $ 610
(1.0 %) :$ 633
180cst: $ 641
(1.0 %):$ 665
MGO 0.1%S: $ 945