---

Fuel oil trend

Rotterdam: $ 5 lower
Singapore: $ 1 lower
US Gulf: $ 4 lower

Supply worries eased; improved economic numbers in the U.S. (Brent: $113.7)

Oil market supply worries were calmed slightly yesterday with OPEC stating that Saudi Arabia is ready to increase production in case of major supply disruptions in Iraq. Saudi Arabia is the largest oil producer in OPEC and holds approx. 1 ½ - 2 mbpd spare capacity, according to the EIA. Spare capacity is defined as oil that can be brought on within 30 days and sustained for at least 90 days. Iraq is currently exporting around 2.6 mio. barrels per day; exports have not yet been affected, but unrest continues to escalate.

Yesterday's API weekly crude stock surprisingly increased to 4.000m; raising volatility around today's EIA data where a draw is expected. According to U.S. officials, ultralight oil could be allowed to be exported after minimal refining process. This seems to be a slight easing of the ban on exporting U.S. crude.

Economic data:

U.S. durable goods orders, flash Markit PMI Services and GDP will be followed closely this afternoon for hints of continued economic growth in the world’s top consumer. Yesterday, the U.S. New Home Sales came out with an increase (504K versus 425K previous) as did the CB Consumer Confidence (85.2 versus 82.2 previous). The German Ifo Business Climate Index were a bit lower than expected (109.7 versus 110.4 previous).