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Fuel oil trend

Rotterdam: $ 3 higher. Singapore: $ 5 higher. US Gulf: $ 3 higher.

The U.S. reaches milestone towards oil independence (Brent: $107.4)

For the first time in 18 years the U.S. domestic production exceeds the amount of imported crude. Production totalled 7.7mbpd in October. It thereby seems that U.S. is en route to the 2015-mark where the imported crude amount supposedly will drop to zero. On a global scale it will however be partly countered by lack of investments/maintenance in Middle Eastern oil fields. According to IEA, the world could be in for an unpleasant surprise regarding rising oil prices in less than 7 years if exploration and maintenance is not conducted in many OPEC countries.

Later today (16.00 CET) the de facto sole candidate to succeed Ben Bernanke s chairman of the FED, Janet Yellen, will hold a press conference. Market will closely monitor any hints as to the future of the much debated QE program. Rumours have started circulating that tapering of the $85bn/month program could start within the next 4 weeks. Should tapering begin, it would be short term bearish for prices, but as market participants will slowly realize it's in their own best interest that the FED removes the punchbowl, things should slowly return to normal.

U.S. inventory figures will be published today at 17.00 CET.

Recommendation

Yesterday's closing price and bullish momentum has increased the likelyhood of a further upwards attempt in the coming days. If resistance is cleared at the 108-ish level, prices are aiming at 110-112 for the next stop. Any setbacks towards 106 looks to be good buying opportunities.