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Oil prices edged above $101 a barrel on Thursday on hopes that U.S. political leaders will find a deal to raise the debt ceiling and after the temporary abduction of the Libyan prime minister reminded investors of threats to crude supplies. By early afternoon in Europe, benchmark oil for November delivery was up 42 cents to $102.03 a barrel in electronic trading on the New York Mercantile Exchange. The contract for the benchmark grade fell $1.88 to close at $101.61 on Wednesday.

In the early hours of European trading on Wednesday oil futures at ICE and NYMEX consolidated on a slightly higher level. In the early afternoon, however, there were technical selling orders which erased all of the gains oil futures marked Tuesday. This reaction was prompted by the technical constellation, with the stochastic indicator finally confirming the selling signal it had given at the WTI chart on Tuesday at the Brent and Gasoil chart as well. When oil prices broke above several short-term supports a technical sell-off accelerated the decline. In late-afternoon trading selling pressure was increased by market fundamentals as the DOE's data showed massive builds in crude oil stockpiles in the USA. Particularly WTI remained weaker given the unexpectedly sharp increase in inventories and so the spread between the US crude and its European benchmark blend (Brent) widened to some 7.40 USD for the November contracts. After submission deadline, the US-Fed released the minutes of the FOMC's most recent meeting (September 17/18). The minutes show that more members of the FOMC than expected still approve of the central bank's loose monetary policy, a fact that slightly bolsters oil prices. Moreover, oil giant Shell declared that new leaks had been discovered at the Trans Niger Pipeline which is why the pipeline had renewably been shut down. Whilst WTI stayed near its low, the remaining futures were able to slightly recover last night but still settled with losses.

ICE Gasoil contract for October delivery settled at 925.25 USD on Tuesday. This was 10.25 USD below Tuesday's settlement. With some 49,400 deals, the traded volume was below average.

The lines of the stochastic indicator crossed at the Brent and the Gasoil chart yesterday confirming the selling signal at the WTI chart (Tuesday). The indicator remains bearish at all charts this morning but yesterday's considerable profit taking has already spent some of the downward potential that had been generated by the technical selling signals. Therefore, we still assess the technical situation as neutral to bearish this morning. The downward potential is likely to be limited by supports at 101.05 dollars (WTI), resp. at 921.75 dollars (Gasoil October contract). If these supports are sustainably breached, technical selling pressure is likely to rise even more.

U.S.

Nymex bearish: This morning some market players took the chance to cover their short positions after yesterday's losses. This has slightly fostered oil prices. The minutes of the FOMC's latest meeting, released yesterday evening, and the Janet Yellen's nomination for the post of the next chairman of the Fed have also slightly bolstered oil markets. Janet Yellen is seen as a proponent of the Fed's easy money policy. The traded volume at NYMEX is about on average for this time of day. Investors are now eying the performance of European markets, new signals from forex trading and today's economic indicators.

Houston (ex-wharf indications 10-10)
380cst $602
180cst $658
MGO $998

New Orleans (ex-wharf indications 10-10)
380cst $606
180cst $652
MGO $1001

Singapore

Crude is bearish with WTI -$1.27. Singapore paper is neutral with +$1.55 for 180cst and +$1.70 for 380cst for Oct, and for Nov 180 cst +$1.50 and 380cst +$2.00 with MGO contracts Oct +$0.43 and Nov +$0.35. The cargo market is bullish with 180cst +$8.07, 380cst +$8.01 and MGO +0.44.

The Singapore fuel oil markets surged app. $8.0 during the Asian Platts window yesterday. The Asian fuel oil cracks saw a firm rebound and delivered bunker premiums were seen between $4.5 and $5.5 above cargo prices. This morning markets are trading higher.

380cst $609
180cst $611
MGO $925

Fujairah (delivered indications 10-10)

380cst $611
180cst $669
MGO $1000

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $589
(1.0 %) :$605
180cst: $619
(1.0 %):$ 636
MGO 0.1%S: $ 901