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Nymex crude prices continued to rise during Asian trading hours this morning after hitting four-month highs soft U.S. data, a winter storm and supply concerns in the Middle East.

After the holiday on Monday, US traders returned to their desks yesterday. In the first half of the European session market players thus remained cautious and oil futures stayed within a relatively narrow range. In the course of the day, the rather bullish technical and fundamental situation prevailed, however, and so oil futures breached first resistances triggering more technical buying. Doubts regarding the success of nuke talks, which were resumed in Vienna yesterday, the still extremely cold temperatures in the USA and new production losses in Libya created a bullish sentiment on oil markets. On the one hand, the softer dollar added to momentum for oil futures, as dollar-denominated oil got cheaper for investors outside the USA, on the other hand, on the other hand, the stronger euro prevented a surge in domestic prices in the euro zone. According to a report the private institute Grenscape Inc. released last night, crude oil stocks in Cushing have declined by 2.7 million barrels last week, which is a far sharper draw than several analysts expected in a survey. This additionally pushed prices higher. Futures thus settled with gains near their intraday highs. Only NYMEX Heating Oil has gained less ground as the scant supplies in distillate stocks in the USA has largely been priced in and Gasoil deliveries from Europe slightly ease bottlenecks.

ICE Gasoil contract for March delivery settled at 933.00 USD on Tuesday. This was +9.00 USD above Monday's settlement. With some 57,300 deals, the traded volume was on average.

The stochastic indicator was already bullish at the Gasoil chart yesterday. Given yesterday's price surge, its influence is likely to have been spent by now. At the WTI chart, the indicator gave a confirming buying signal last night. However, this buying signal has been slightly skewed by spreadbets following the Grenscape news on Cushing crude oil stocks. The stochastic indicator is still neutral at the Brent chart, whereas the RSI is in overbought territory at all charts. In all, we thus currently assess the technical situation as neutral, even though a bullish point of view would be possible, too, given the buying signal of the stochastic indicator at the WTI chart. Yesterday's late rise favors some profit taking, however. Meanwhile, new bullish cues are unlikely to be generated. Only the stochastic indicator might give a buying signal at the Brent chart. But it also might turn bearish.

U.S.

Nymex bullish: Oil markets are currently seeing some profit taking. However, there are no larger moves. The traded volume at NYMEX is far above average for this time of day, as the front month contract of WTI is going to expire tomorrow and traders already shift their positions to contracts due in the following months. Investors are now eying the development at stock markets waiting for new cues from forex markets and today's economic data. They also look ahead to the API's data on US oil inventories.

Forecasts: Crude oil +1.8; Distillates -1.8; Gasoline -0.9 million barrels vs previous week.

Houston (ex-wharf indications 19-2)
380cst $604
180cst $682
MGO $1010

New Orleans (ex-wharf indications 19-2)
380cst $621
180cst $660
MGO $1021

Singapore (delivered indications 19-2)

WTI is bullish with +$1.71. Singapore paper remains bullish with +$4.10 for 180cst and +$4.40 for 380cst for Mar, and for Apr 180 cst +$3.85 and 380cst +$4.00 with MGO contracts being bearish Mar +$1.00 and Apr +$0.97. The cargo market is bullish with 180 cst -$0.45, 380cst +$0.03 and MGO +$0.23.

Singapore fuel oil market reported relatively quiet day yesterday with demand matching supply and prices remained at previous day’s levels. This morning both markets are trading slightly higher.

380cst $620
180cst $631
MGO $935

Fujairah (delivered indications 19-2)

380cst0 $613
180cst $642
MGO $980

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $589
(1.0 %) : $638
180cst: $619
MGO 0.1%S: $ 890