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Brent crude oil held steady above $112 a barrel on Wednesday as investors awaited inventory data from the United States for clues on the demand outlook of the world's largest oil consumer. Brent crude rose 12 cents at $112.54 a barrel by 1224 GMT. U.S. crude for March rose 13 cents at $96.81, off a four-month high of $96.90 hit earlier. Appetite for riskier assets was buoyed on Tuesday by the Bank of Japan's plans to shore up the world's third largest economy and strong investor confidence data from Germany. These added to upbeat economic data this month from the top two oil consumers, the United States and China. After the bank holiday in the USA on Monday, the oil market started rather volatile on Tuesday and was oriented towards the stock and forex market. When the BoJ announced unlimited expansive measures, it shortly had a supportive effect but a wave of technical profit-taking in the morning resulted in a price slump. However, supports at 965.00 dollars G.Oil and 111.40 dollars Brent proved to be strong, favouring an upward correction. The positive ZEW economic data as well as the resulting recovery of the stock market and the euro added to this. The tendency largely remained strong throughout the day, following the huge stock indices, which investors regard as indicators for the economic situation. The disappointing economic data out of the USA temporarily dampened market sentiment but the Brent price still rose to a 3-month high and WTI even to a 4-month high. However, distillates did not gain nearly as much.

ICE Gasoil contract for December delivery settled at 969.75 dollars on Tuesday. This was 5.25 dollars above Monday's settlement. With some 62,000 deals the traded volume was about average.

There are still no fresh signals to be seen in the technical view. The overbought market situation would, however, favour a downward correction in case of technical selling orders. This could arise at the RSI, for instance, if it crossed the 70%-line top-down at the WTI and the G.Oil chart. The stochastic oscillator could also trigger a downward correction if its lines crossed. But at the moment, the indicators are both neutral and thus the technical analysis only offers a neutral basis. Not only the (still) neutral technical view but also the current trend channels, which are still intact, indicate that prices consolidate at a high level. It also leaves room for a small technical downward correction and profit-taking after prices traded up again late in the evening.

U.S.

Nymex slightly bullish: The retreating stock market in Asia (Nikkei 225) favoured small profit-taking this morning after Brent and WTI had reached a 3-month and 4-month high respectively in late trading yesterday. Trading interest at NYMEX is about average for this time of day. Market participants are waiting for the European market to open and for signals from the forex market. There are only a few economic data to be released today.

Survey of US Petroleum inventories due out tonight at 22:30(API) and Thursday at 16:30 (DOE)
Forecast: Crude oil +2.3; distillates -0.3; gasoline +1.3 million barrels vs previous week.

Houston (ex-wharf indications 22-01)
380cst $632
180cst $696
MGO $1020

New Orleans (ex-wharf indications 22-01)
380cst $638
180cst $672
MGO $1015

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

WTI is neutral with +$0.61. Paper for Jan are bearish, dropping with 180cst -$3.00 and for 380cst -$1.75 , Feb contracts are dropping as well with 180cst -$1.00, 380st -$1.00. The cargo market reacted bearish, dropping with 180cst -$6.71, 380cst -$7.38 and MGO +$0.04.

The Singapore fuel oil market prices fell more than $6.5 during the morning Platts window yesterday. There was strong selling interest in fuel oil swaps and cracks came off considerably. The delivered bunker premiums were around $6.0 above cargo prices yesterday as crude values strengthen after the window. This morning the markets are trading slightly lower.

High premiums for prompt deliveries.
380 cst $628
180 cst $634
MDO $950

ARA (Amsterdam - Rotterdam - Antwerp)

There were a few suppliers who were unable to supply for prompt deliveries due to busy schedules. The port of Rotterdam and Antwerp are experiencing difficulties with LSFO for prompt deliveries due to operational delays. Due to the tightness of LSFO in Antwerp the premiums are expected to be higher.

Indications for delivered bunkers:
380cst : $ 615
(1.0 %) :$ 648
180cst: $ 645
(1.0 %):$ 678
MGO 0.1%S: $ 967