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Oil prices in London and New York have gained again this morning. Brent and WTI tested their second resistance while tropical storm Karen is swaying over the U.S. Gulf Coast. According to the Hurricane Center, it may develop into a hurricane today. Several oil companies have already withdrawn their staff from the plants in the region. Moreover, oil markets also draw support from yesterday’s technical buying signal. However, as the euro slipped, upward potential has remained limited. In addition, the budget standoff in the USA keeps weighing on oil prices. If the situation persists like this, market players fear great repercussions for the U.S. economy and thus, oil demand.

On Wednesday, oil contracts at ICE and NYMEX closed with considerable gains despite the DoE’s bearish inventory data, which had shown a strong build in crude and gasoline stockpiles due to lower demand. After the operating company of the Keystone XL pipeline announced to launch the Southern part of the pipeline soon, oil prices surged late Wednesday and continuously rose until Thursday afternoon. Due to the tropical storm which is heading towards oil facilities in the Gulf of Mexico and the U.S. South, investors placed numerous long positions. Experts doubt, however, that the storm would make a great impact on the oil industry. Thus, speculators seized the opportunity to rake in some profits. They also bear in mind the U.S. budget debate. The repercussions on the American and global economy might be bigger than expected and thus, also weighs on oil prices. Consequently, oil futures ceded most of their gains in late trade Yesterday. But in view of the tropical storm in the Gulf of Mexico, a downward correction has yet failed to materialize.

ICE Gasoil contract for October delivery settled at 926.50 USD on Thursday. This was 4.00 USD above Wednesday's settlement. With some 43,600 deals, the traded volume was below average.

Although the Stochastic had already given off a buying signal yesterday, the indicator also remains bullish today. The RSI also provided a buying signal for WTI. Since these signals have already been triggered yesterday, we consider the technical constellation as only slightly bullish. Moreover, the RSI is already neutral again. Market players may focus on fundamentals today. It will be decisive for price development today how tropical storm Karen progresses.

U.S.

Nymex bullish: Globex trade (NYMEX electronic computer trading) situation in the morning Oil futures are recovering from yesterday’s lows this morning. The bullish effect of the tropical storm in the USA supports prices and prevents another downward correction. The traded volume at NYMEX is below average for this time of day. Market players are now eying the performance of European markets, for fresh signals from forex trading and today’s economic data.

Houston (ex-wharf indications 03-10)
380cst $610
180cst $671
MGO $999

New Orleans (ex-wharf indications 03-10)
380cst $612
180cst $655
MGO $1002

Singapore

Crude is turning slightly bearish with WTI -$0.03. Singapore paper is turning bearish as well with -$7.00 for 180cst and -$9.25 for 380cst for Oct, and for Nov 180 cst -$6.00 and 380cst -$5.70 with MGO contracts Oct +$0.10 and Nov -$0.03. The cargo market is bullish still gaining with 180cst +$11.41, 380cst +$10.55 and MGO +1.92

The Singapore fuel oil markets surged up more than $10.5 during the Asian Platts window yesterday lifted by firm buying interest. The Asian fuel oil cracks strengthened as well. The delivered bunker premiums rose accordingly to the strength in physical fuel oil market, seen at $8.0-5.0 above cargo prices. This morning markets are trading slightly lower.

380cst $622
180cst $624
MGO $915

Fujairah (delivered indications 04-10)

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 : $595
(1.0 %) :$606
180cst: $626
(1.0 %):$ 640
MGO 0.1%S: $ 905