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WTI oil futures rallied to an eight-week high this morning, as market players awaited key U.S. weekly supply data to gauge the strength of oil demand from the world’s largest consumer.

Oil futures at ICE and NYMEX made some headway on Monday paring some of the losses they had marked at the end of last week. Futures were fostered by the figures on the Chinese trade balance released at the weekend and by the announcement of the Chinese central bank that it would lower the level of obligatory reserves of business banks in order to boost lending and the economy in general. The insecurity regarding the events that are on this week's agenda also had a bullish effect. Along with the weekly data on US oil inventories, the EIA, the OPEC and the IEA are going to release their monthly energy reports. Moreover, the members of the OPEC are going to meet in Vienna this week whereas the negotiations between Russia and Ukraine over Russian gas deliveries are to be continued in Brussels. In terms of demand, most investors expect that the monthly energy reports will show a significant rise in the second half of the year. Technically, the bullish factors have also increased. After the stochastic indicator had given a buying signal at the end of last week, the RSI has by now confirmed this signal exceeding 30%. In the course of the day, Brent and WTI broke above their short-term down trends triggering even more technical buying orders. Particularly crude oil futures profited from this. Quotations largely kept track of their steady tendency until late in the evening settling near their highs. The euro proved weaker in the course of the day, however, indicating higher domestic prices in the euro zone as oil futures had gained ground.

ICE Gasoil contract for June delivery settled at 892.25 USD on Monday, +8.25 vs Friday's settlement. With some 34,600 deals, the traded volume (front month) was below average.

After the stochastic indicator had given a buying signal at the end of last week, the RSI confirmed the signal at the WTI and the Brent chart yesterday. The indicator surpassed 30% making oil futures exceed their down trends. This initiated a technical rise. Even though the technical cues aren't really fresh, the break of oil futures above their down trends generated more upward potential. Oil prices actually are seizing this upward potential at the moment. Thus, we are assessing the technical constellation as neutral to bullish, for the time being. The bullish note might prevail if the RSI also surpassed 30% at the Gasoil chart in the course of the day.

U.S.

Nymex above average: After yesterday's rise, oil futures in London and New York are still tending to the upside. Quotations have already exceeded yesterday's highs. The traded volume at NYMEX is far above average at this time of day. Market players anticipate the opening of stock and forex markets and will keep an eye on today's indicators as well as the gas dispute between Ukraine and Russia. Moreover, they are waiting for the EIA's monthly energy report due in the evening.

Houston (ex-wharf indications 10-6)
380cst $602
180cst $702
MGO $982

New Orleans (ex-wharf indications 10-6)
380cst $604
180cst $684
MGO $975

Singapore (delivered indications 10-6)

WTI is up with +$0.78. Singapore paper is up with +$1.46 for 180cst and +$2.25 for 380cst for Jun, and for Jul 180 cst +$2.90 and 380cst with +$4.15 with MGO contracts being bullish in Jun with +$0.17 and in Jul with +$0.27. The cargo market is bearish with 180cst -$1.81, 380cst with -$3.72 and MGO with -$0.30.

The Singapore fuel oil prices started the week lower, down by more than $2.0 during the Platts window yesterday. Market remained firm while a higher incoming estimate for July may have started to ease. The 380cst physical cargo market flipped to discount on aggressive offers. The delivered bunker premiums were ranging between $3.0 and $5.0 above cargo prices yesterday.

380cst $598
180cst $622
MGO $890

Fujairah (delivered indications 10-6)

380cst $608
180cst $643
MGO $985

ARA (Amsterdam - Rotterdam - Antwerp)

380cst : $579
(1.0 %) : $630
180cst: $619
MGO 0.1%S: $856