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Crude prices slipped below $103 a barrel on Monday weighed by a stronger dollar and a drop to an eight-month low in oil demand in the world's second-largest consumer China. China's refinery crude throughput fell 3 percent in April from March, its lowest daily rate since last September, as refineries entered maintenance season. Implied oil demand in the country was up 3.2 percent in April from a year earlier to about 9.6 million barrels per day (bpd), the lowest in eight months. Brent crude slipped $1.07 cents to $102.84 barrel by 1010 GMT. U.S. oil fell $1 cents to $95.04 a barrel.

The oil market had started softer on Friday. Traders took first profits during morning trade and thus, first supports were breached early on. The strong dollar as well as the slightly bearish technical constellation and bearish fundamentals from the previous days (U.S. oil inventories, EIA monthly report, rising exports and OPEC’s oil production) favoured profit taking throughout the day. However, market players had remained cautious ahead of the release of OPEC’s monthly energy report. Although OPEC maintained its demand prognosis determined in the last report, it was largely considered bearish. The more so as the cartel pointedly warned China and Europe that they might be even more hit by sluggish oil demand in the future due to steady growth of their economies. Amidst a bear market, oil prices plummeted in the afternoon after several supports at ICE and NYMEX had been breached. Numerous technical stop-loss orders were triggered, accelerating the downturn which only halted at 850.00 USD (G.Oil) and at 93.35 USD (WTI). In the course of the evening, traders then turned the tables and oil futures counteracted, making up for the bulk of the losses incurred. The correction can largely be attributed to investors liquidating their speculative short positions which had been placed during the price slump in order to limit risk positions ahead of the weekend.

ICE Gasoil contract for June delivery settled at 851.75 USD on Friday. This was 18.75 USD below Thursday's settlement. With some 105,8000 deals, the traded volume was far above average.

The technical view does not display anything new this morning. The Stochastic remains slightly bearish given last week’s selling signal. WTI has managed to stay above its medium-term support line - despite Friday’s downward reaction -, which forms a key resistance at 93.80 today. G.Oil’s key line may be its support at 850.00 USD. As fresh signals are currently lacking, we consider the technical constellation as neutral to bearish this morning.

U.S.

Nymex bearish: Oil futures have been edging lower in Asian trading this morning in view of OPEC’s sluggish demand forecast last week. Slightly mixed Chinese indicators hardly made an impact at the oil market. The traded volume at NYMEX is above average for this time of day. Market players now look ahead to the performance of European stock markets, to clues from forex trading as well as to the release of today’s economic data.

Houston (ex-wharf indications 10-05 )
380cst $594
180cst $644
MGO $972

New Orleans (ex-wharf indications 10-05)
380cst $604
180cst $644
MGO $975

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

Crude is bearish with -$0.52. The paper market is dropping still, with May 180cst -$9.50 and for 380cst -$9.50, and June contracts with 180cst -$8.85, 380st -$9.10. The cargo market is dropping, with 180cst -$5.86, and 380cst -$3.37 and MGO +$0.49.

The Singapore fuel oil markets fell between -$6.0 to -$3.0 during the morning Platts window last Friday. The delivered bunker premiums eased to $7.0 above cargo prices as crude softened after the window. This morning the markets are trading slightly higher.

High premiums for prompt deliveries.
380 cst $599
180 cst $605
MGO $871

Fujairah (delivered indications 13-05)

380cst $610
180cst $675
MGO $1010

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $585
(1.0 %) :$ 615
180cst: $ 615
(1.0 %):$ 645
MGO 0.1%S: $ 840