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Fuel oil trend

Rotterdam: $ 8 higher.
Singapore: $ 12 higher.
US Gulf: $ 2 higher.

Fear of supply disruptions is ruling (Brent: $113.7)

As militants are closing in on Baghdad in Iraq and the U.S. is threatening to intervene with military strikes, fear of an escalating situation in the region is up. Oil prices are up to a nine-month high this morning; mainly because markets fear this will affect oil supply. So far, disruptions are limited, but fear alone seems to suffice in bringing prices higher. Iraq has the world's 5th largest proven oil reserves with an estimated daily production of 3.3 mbpd (April 2014) with large oil fields and pipelines in the northern part of the country as well, where violence and fighting are worst at the moment.

On the economic data front, Chinese Industrial Production data came out around expectations of 8.8% this morning; and later today we will see the latest Producer Price Index (PPI) as well as Michigan Consumer Expectations and Sentiment from the U.S. Yesterday's U.S. data came out slightly below expectations, with retails sales rising by 0.3% (0.5% previous) and a rise in initial jobless claims (317K versus 313K previous).