---

Fuel oil trend

Rotterdam: $ 1 higher.
Singapore: $ 1 lower.
US Gulf: $ 1 higher.

Missing oil revenue causing problems in Libya (Brent: $109.9)

Certain Libyan public authorities are struggling to make ends meet as the government is urgently in the need to see oil export pick up again. Things have however been moving in the wrong direction for the government, as local tribal leaders seized yet another oil field. Pre-war production was at 1.6mbpd of very high quality oil, whereas current production has been cut by 85% to approximately 230,000 bpd. Libyan oil contains a lot of the blockbuster products (diesel, gasoline, etc) and relatively little residue, which makes Libyan crude hard to replace. As long as the Libyan security situation is unstable (and that is expected to last quite a bit), global oil prices will be buoyed by the missing high quality oil.

Today no important macro figures are scheduled (some Euro inflation figures due at 11.00 CET, but that won't rock the boat). Prices are likely to trade mostly sideways today. We expect oil prices to move sideways over the next few days, with a potential minor setback (1%-ish), before resuming the upwards trend that began earlier this month.

Recommendation

We particularly advise consumers to take note that the low inventories for distillates and lighter products could lead to fundamentally firmer prices.