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Given the losses at European stock markets and the softer euro, oil futures have slid into the red this morning, with Brent declining more than the other contracts. The North Sea crude fell below its support at 104.35 USD but the vague selling signal that is about to arise at the Stochastic has not been triggered yet. Consequently, investors have remained cautious this morning and rather reduced their riskier positions, waiting on the sidelines not only for the API (tonight) and the DoE (Wednesday) but also for Ben Bernanke and the FOMC minutes. Speculations over a reduction of the Fed’s bond purchases have increased lately but according to Energy Aspects analyst Amrita Sen, the Brent price is to remain within the price range of 100 to 105 USD per barrel in the forthcoming sessions, adding that that the markets were “so used to liquidity these days that people are scared about Quantitative Easing coming to an end” in the USA and thus, investors keep a low profile ahead of the FOMC meeting on Wednesday. As the euro failed to sustainably breach its first support this morning, losses remained limited. Downside has also been contained by news out of China, stating an increase in crude imports (+3.7% in April on the year). As far as economic data is concerned, there only are U.S. retail sales left on the agenda.

Oil markets started off with a strong tendency Monday, trading on their upward potential. In the course of the morning, investors tended to take profits before oil prices climbed up in the late afternoon. News on a leakage at the WTI reference stock in Cushing, Oklahoma may have shortly caused some concerns because has not led to any transport or shipping bottlenecks, but this incident should not considerably affect prices; rather, the slightly bullish atmosphere added to the gains oil prices had made at the close of trading.

ICE Gasoil contract for June delivery settled at 882.75 USD on Monday. This was 7.00 USD above Friday's settlement. With some 48,300 deals, the traded volume was slightly below average.

Neither the Stochastic nor the RSI are giving off any fresh signals this morning and are thus still neutral. The two lines of the Stochastic oscillator are already touching at the Brent chart but a selling signal will only arise if these lines cross. At crude charts, a double top could form at 195.40 USD (Brent) and 97.20 USD (WTI). If these marks cannot sustainably be breached to the top, the technical constellation would favour some profit taking.

U.S.

Nymex neutral: After yesterday’s sharp rise, oil futures at ICE anc NYMEX are holding steady at their heigh level this morning, trading hardly changed compared to Monday’s settlement. Trade volume at NYMEX is about for this time of day. Investors are now waiting for the European markets to open, for fresh signals from forex trading but there are hardly any economic data on the agenda today.

Houston (ex-wharf indications 16-05 )
380cst $692
180cst $645
MGO $966

New Orleans (ex-wharf indications 16-05)
380cst $605
180cst $652
MGO $964

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

Crude is up with +$1.16. The paper market is following, gaining with June 180cst +$2.25 and for 380cst +$0.10, and July contracts with 180cst +$1.10, 380st +$1.10. The cargo market is bullish still, with 180cst -$0.04, and 380cst +$0.35 and MGO +$0.75.

The Singapore fuel oil markets started the week marginally up during the Platts window yesterday. Traders and shipping brokers surveyed estimate that about 5.92 million mt of fuel oil will arrive in the region this month, up 9.7% from April. Market demand was said to be slow yesterday. The delivered bunker premiums fell to around $4.0 above cargo prices. This morning both markets are trading slightly lower.

High premiums for prompt deliveries.
380 cst $602
180 cst $611
MGO $880

Fujairah (delivered indications 21-05)

380cst $615
180cst $682
MGO $1020

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $585
(1.0 %) :$ 608
180cst: $ 617
(1.0 %):$ 643
MGO 0.1%S: $864