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Brent crude oil rose towards US$110 per barrel on Tuesday after oil exports from Libya fell to their lowest for two years, heightening supply worries ahead of scheduled cuts in output from fellow OPEC member Iraq. Striking security guards shut Libya’s two biggest crude export terminals on Monday, hours after they had reopened, and more oilfields have closed in a wave of protest that has swept the North African oil producer. Libya’s deputy oil minister said exports could resume as early as Thursday after workers and local authorities reached an agreement to end the strike. But markets worried supplies could be insufficient to meet demand due to restocking before the northern hemisphere winter.

After oil markets had seen a strong increase in prices on Friday, oil futures started rather rangebound this week. Although Brent breached its first support towards noon due to profit-taking, however, it was not sustainable. Thus, ICE contracts traded close to their opening level again at the opening of NYMEX floor trade whereas WTI was pressured by the rising dollar and fell below its support at 105.35 USD. The bullish technical constellation, the good mood at Wall Street as well as rekindling supply fears then buoyed up oil prices to hit new day’s highs. It was when BP notified of a cut-back in Ekofisk production in the North Sea due to problems on a production platform. Moreover, two Libyan oil terminals were shut down again shortly after having reopened. This particularly bolstered ICE futures which consequently breached several resistances while WTI was stuck in its technical trading range. NYMEX gasoline was also trading rather flat in view of an expected record high in U.S. oil inventories.

ICE Gasoil contract for September delivery settled at 914.25 USD on Monday. This was 8.75 USD below Friday's settlement. With some 86,400 deals the traded volume was far above average.

After oil futures breached several supports yesterday, with Brent breaking below its mid-term trend channel, the bearish component of the technical constellation still predominated on Thursday. This morning, however, the lines of the stochastic indicator are converging at all charts. If they cross, there might be a buying signal. The RSI is still neutral not giving any new cues. Today, technical analysts expect that oil prices are most likely to consolidate, the more so as the downward potential has largely been spent after the sharp decline in oil prices over the past few days. Moreover, market fundamentals like economic indicators and the IEA's resp. the OPEC's monthly energy reports are likely to be in focus. We therefore assess the technical situation as neutral this morning.

U.S.

Nymex bullish: After surging in late trade yesterday, oil futures at ICE and NYMEX are moving close to Monday’s closing level. Concerns about further tightening oil supplies from the Middle East support prices at their high level. The traded volume at NYMEX is slightly above average for this time of day. Market players are now eying the performance of European markets, new clues from forex trading as well as a series of economic data, and the weekly inventory data by the API.

Houston (ex-wharf indications 12-08 )
380cst $595
180cst $665
MGO $1001

New Orleans (ex-wharf indications 12-08)
380cst $596
180cst $642
MGO $1002

Singapore

The Singapore fuel oil markets reopened yesterday after a long weekend. The fuel oil prices were mixed ranging between -$1.0 and $+0.50 during the Asian Platts window. The market remains weak with ample supply and demand lagging behind. The delivered bunker premiums were seen at $7.5-6.5/mt. This morning the markets are trading higher.

380cst $605
180cst $655
MGO $980

Fujairah (delivered indications 13-08)

380cst $605
180cst $655
MGO $980

ARA (Amsterdam - Rotterdam - Antwerp)

Due to the availability problems with hsfo ( long waiting time at refineries, only contracts with some ex wharf suppliers, less spot available at higher premiums) the spread between hsfo and lsfo is minimum. In September ESSO Antwerp will have even more avail problems as they are working on maintenance of their refinery. Because of this, local Antwerp suppliers will need to buy more product in Rotterdam, therefor long waitinglines at Rotterdam refineries and storage are to be expected, with premiums on price as a result.

Indications for delivered bunkers:
380cst : $600
(1.0 %) :$610
180cst: $630
(1.0 %):$ 640
MGO 0.1%S: $ 900