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Oil eased below $106 a barrel on Wednesday after U.S. crude oil stocks swelled to the highest level in more than two decades and dented the outlook for demand in the world's top consumer. Data from industry group the American Petroleum Institute showed a sharp rise of 5.1 million barrels in crude inventories last week, far higher than forecasts of a 1.5 million-barrel rise. The U.S. Energy Information Administration (EIA) later on Wednesday could show a rise of 1.4 million barrels, according to a Reuters poll of analysts. Brent crude futures slid 61 cents to $105.62 a barrel by 1221 GMT, while U.S. crude fell 55 cents to $93.65.

Tuesday morning, oil futures initially remained rangebound. Throughout the day, there were but few fundamental news as important economic data was lacking. Markets had only received some new cues at the beginning of US trading in the afternoon and so oil futures breached their first supports. Since a first survey lead to expect that US oil stockpiles have renewably increased, there was a brief downward move before quotations pared their losses later in the evening. While product futures climbed back near Mondays settlement levels, crude oil futures sharply gained. Dominick Chirichella, analyst at Energy Management Institute, supposes that this rise has been caused by investors taking profits from their short positions (short-covering). They had raised these short positions during last week's steep decline in oil prices. Since investors expect that refineries will raise their capacities in the coming weeks - making crude oil demand rise - they cut these short positions.

ICE Gasoil contract for April delivery settled at 878.50 USD on Tuesday. This was -2.25 USD above Monday's settlement. With some 46,700 deals the traded volume was below average.
v The stochastic indicator is bullish both at ICE and at NYMEX charts after its lines have crossed. The RSI remains neutral, however, and will only give a buying signal if it exceeds the 30%-line. Markets are still oversold but particularly the Brent and the WTI have spent most of the stochastic's buying signal with their rise yesterday evening. From a merely technical stance, the situation is thus still slightly bullish.

U.S.

Nymex bullish: Oil prices have consolidated on a high level this morning in early Asian trading. Traded volume at NYMEX is below average for this time of day. Market players are now eying the performance of European markets, fresh signals from forex trading as well as economic data on the agenda today, and the DOE's report which is to be released at 4.30 p.m. this afternoon.

DOE: out tonight
API: crude oil+5,1; distillates -1,3; gasoline +2,0 million barrels vs previous week.
Survey: Crude oil + 1.2; distillates -0.9; gasoline -1.5 million barrels vs previous week.

Houston (ex-wharf indications 09-04 )
380cst $608
180cst $663
MGO $994

New Orleans (ex-wharf indications 09-04)
380cst $610
180cst $649
MGO $995

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

Crude is gaining momentum, gaining with +$0.29. The paper market is gaining as well, with April 180cst +$1.90 and for 380cst +$2.50, and May contracts with 180cst +$1.90, 380st +$2.50 The cargo market is slightly bullish with 180cst +$1.60, and 380cst +$1.15 and MGO +$0.34.

The Singapore fuel oil markets were up +$1.0 during the morning Platts window yesterday. Market remained surprisingly strong with cargo premium ranging between $1.0 to $3.0, while April incoming volumes are estimate at 4.7 million mt. The delivered bunker premiums were seen around $8.0 above cargo prices. This morning the markets are trading higher.

High premiums for prompt deliveries.
380 cst $618
180 cst $625
MGO $890

Fujairah (delivered indications 10-04)

380cst $626
180cst $675
MGO $1005

ARA (Amsterdam - Rotterdam - Antwerp)

Prompt deliveries were not possible from most of the suppliers last couple of days as barges have been already fully committed for earlier deliveries. Supplies were also interrupted by loading delays at some refineries and/or storages. Especially HSFO seems to be a problem at the moment for prompt enquiries.

Indications for delivered bunkers:
380cst : $597
(1.0 %) :$ 608
180cst: $ 627
(1.0 %):$ 638
MGO 0.1%S: $ 864