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Oil prices rose to new highs in the afternoon, spurred by the euro’s rally and technical buying orders. Prior to the release of the DoE data, gains remain limited. After WTI breached its resistance at 101.90 USD, ICE contracts followed, breaching the resistances at 914.00 USD (G.Oil) and at 108.00 USD (Brent). Technical buying orders and the stronger euro pushed oil futures even higher. But in view of the disappointing ADP data, Brent’s strong resistance at 108.40 then caused a small counter-reaction. Democrats and Republicans failed to pass the 2014 budget as expected, which resulted in a government shutdown. In the course of morning trading, oil futures still held relatively steady and stayed within their technical limitations. Selling pressure increased, however, at the opening of U.S. markets. Helped by the slightly bearish technical constellation, oil prices then breached their first support. Market players are afraid that the powering down of federal agencies might negatively affect economic recovery in the USA and thus, oil demand. Only in the late evening did oil prices return from their lows, which analysts deemed a technical correction, however. As WTI was not able to sustainably breach its support, traders seized the opportunity to take profits from speculative short positions. In the end, oil markets settled with losses.

ICE Gasoil contract for October delivery settled at 905.25 USD on Tuesday. This was 7.75 USD below Monday's settlement. With some 42,400 deals, the traded volume was below average.

After the Stochastic gave off a selling signal for G.Oil and Brent yesterday, the indicator also remains bearish for ICE contracts this morning. Although the Stochastic's lines are touching at the WTI chart, a fresh selling signal will only arise if they cross. Thus, we maintain our slightly bearish evaluation and still see oil futures trading within their downtrend channel.

U.S.

Nymex bullish: Without fresh signals to give direction, oil futures are trading at yesterday's closing level, still only showing little volatility. The traded volume at NYMEX is below average for this time of day. Investors are now looking ahead to the performance of European markets. to further developments in the USA and are waiting for today's economic indicators and the DoE inventory data.

API's: Crude oil +4.5; distillates -1.6; gasoline +3.3 million barrels vs previous week. Refinery utilization -1.5%.
DOE's; Crude oil +5.5; distillates -1.7; gasoline +3.5 million barrels vs previous week. Refinery utilization -1.3%.
Forecasts: Crude oil +2.5; distillates -1.4; gasoline -0.7 million barrels vs previous week.

Houston (ex-wharf indications 02-10)
380cst $614
180cst $676
MGO $1000

New Orleans (ex-wharf indications 02-10)
380cst $616
180cst $659
MGO $1010

Singapore

Crude is bullish still with WTI +$2.15. Singapore paper is gaining with +$12.75 for 180cst and +$12.35 for 380cst for Oct, and for Nov 180 cst +$7.25 and 380cst +$7.50 with MGO contracts Oct +$1.88 and Nov +$1.60. The cargo market is starting to react to crude and paper gaining with 180cst +$0.56, 380cst +$0.63 and MGO -0.02

The Singapore fuel oil markets inched up app. $0.5 during the Asian Platts window yesterday. The delivered bunker premiums strengthened further between +$3.5 to +$7.5 above cargo prices lifted by the stronger buying interest. This morning markets are trading slightly higher.

380cst $622
180cst $624
MGO $915

Fujairah (delivered indications 03-10)

380cst $623
180cst $680
MGO $985

ARA (Amsterdam - Rotterdam - Antwerp)

In September (starting week 4) ESSO Antwerp will start 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. KPC, an other hsfo refinery in Rotterdam is out on maintenace for 4 months. Waiting times are noted for over 1 week at some storages.

Indications for delivered bunkers:
380cst : $600
(1.0 %) :$610
180cst: $630
(1.0 %):$ 646
MGO 0.1%S: $ 904