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WTI oil futures bounced off a six-month low struck in the previous session this morning, as investors awaited the release of weekly supply data out of the U.S. later in the session to gauge the strength of oil demand from the world’s largest consumer.

Oil futures in London and New York tested their resistances on Tuesday morning but failed to breach them. In the course of the day, the declining euro/dollar-parity made dollar-denominated oil more expensive for market players outside the USA. Selling pressure thus predominated at oil markets yesterday afternoon. Quotations breached several supports and not even the positive economic data out of the USA was able to limit losses. Even though the data provided a rather positive outlook for the US economy and oil demand, the dollar was sent higher, too, prompting investors to take some profits. Since the situation of US as well as global oil stocks is rather convenient, profit taking predominated oil markets in the afternoon adding to the bearish tone. Thus, oil prices sharply declined once again, with the front month Gasoil contract hitting a 13-month low. WTI dropped to a 6-month low, whereas Brent fell to the lowest level in 4 months. The surprisingly bullish data of the API, released later in the evening, provided at least some momentum in late trade.

ICE Gasoil contract for August delivery settled at 869.50 USD on Tuesday, this is -10.50 USD below Monday's settlement. With some 35,800 deals the traded volume (front month) was below average.

Meanwhile, the lines of the stochastic indicator are running in parallels again at the WTI chart. Thus, the indicator can be interpreted as neutral again. At the Brent chart, the indicator is still bullish, however, and at the Gasoil chart it is currently giving a buying signal as its lines have crossed. The RSI is still neutral at all charts but it could give a buying signal at the Brent chart if it surpasses 30%. In all, we are assessing the technical constellation as neutral to bullish this morning as the stochastic indicator is pointing to tests of the upside and the RSI might give a confirming buying signal in the course of the day.

U.S.

Nymex below avarage: Oil futures hardly changed in Asian trading and Globex electronic trade this morning after having pulled back from yesterday's (long-time) lows in Tuesday evening trade. The traded volume at NYMEX is below average for this time of day. Traders are now waiting for the opening of stock and forex markets and will keep an eye on the development in Iraq, Ukraine, Israel and Libya. Today, only few economic indicators are on the agenda which is why investors are likely to focus on the DOE's oil inventories data due at 4.30 p.m. this afternoon.

API: Crude oil -5.5; Distillates -0.5; Gasoline -3.6 million barrels vs previous week.
Forecasts: Crude oil -1.5; Distillates +0.7; Gasoline -0.3 million barrels vs previous week.

Houston (ex-wharf indications 6-8)
380cst $585
180cst $672
MGO $963

New Orleans (ex-wharf indications 6-8)
380cst $591
180cst $669
MGO $961

Singapore (delivered indications 6-8)

WTI is down with -$1.05. Singapore paper is down with -$0.85 for 180cst and -$0.50 for 380cst for Aug, and for Sep 180 cst -$1.75 and 380cst with -$1.25 with MGO contracts Aug losing with -$0.65 and in Sep with -$0.62. The cargo market is gaining with 180cst -$3.30, 380cst losing with -$1.45 and MGO gaining with -$0.37.

The Singapore fuel oil prices fell -$3.0 to -$1.5 during the Platts window tracking the weak crude values. The Singapore market remains firm with strong buying for bunker specification cargoes as premiums continue to be bid up on lower incoming arbitrages. Delivered bunker premiums were at +$9.5 to +$11.5 above cargo yesterday. Barges fell $3.5 in the window and delivered premiums is trading $2 to $4 above.

380cst $595
180cst $608
MGO $880

Fujairah (delivered indications 6-8)

380cst $613
180cst $643
MGO $980

ARA (Amsterdam - Rotterdam - Antwerp)

(delivered indications 6-8)
380cst : $569
(1.0 %) : $583
180cst: $559
MGO 0.1%S: $858