---

WTI for October delivery was at $93.68 a barrel in electronic trading on the New York Mercantile Exchange, up 33 cents, at 3:06 p.m. Singapore time. The contract slid 30 cents to $93.35 yesterday, the lowest close since Jan. 14. The volume of all futures traded was about 49 percent below the 100-day average. Prices have declined 4.8 percent this year.

Brent for October settlement was 20 cents higher at $102.85 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of $9.20 to WTI. The spread closed at $9.30 yesterday, the widest since March 14.

Oil futures at ICE and NYMEX remained in a narrow range on Tuesday morning. The return of many British traders after the Summer Bank Holiday-weekend didn't give oil markets a new direction either. The bullish survey of US oil inventories data and the slight decline in Libya's output buoyed oil prices but WTI's key-resistance at 93.75 USD and Brent's psychological bar at 103.00 USD kept gains in check. Only Gasoil already breached first supports in the first half of the day. Traders still remained cautious, however, which is why the resistances at the crude oil charts proved strong. Surprisingly good data on US durable goods orders sent WTI above its key-resistance in the early afternoon, whereas Brent only exceeded 103.00 USD later. This triggered more technical buying pushing futures to new highs. However, oil prices soon pulled back from these highs as traders took profits in volatile trading. The euro that lost some ground in the evening also weighed on oil markets. Therefore futures erased some of their earlier gains. Still they settled with small gains. This and the weaker euro created some upward potential for domestic prices in the Eurozone.

ICE Gasoil contract for September delivery settled at 864.25 USD on Tuesday, this is +4.25 USD above Monday's settlement. With some 57,200 deals the traded volume (front month) was on average.

Neither the stochastic indicator, nor the RSI are giving any fresh cues this morning. When resistances were breached yesterday, new upward potential was generated but the long-term downtrends are still intact. The short-term uptrends that have formed over the past few days might make oil futures test further resistances. Near 102.80 and 102.85 USD Brent found strong resistance, however. This level should be the crucial technical hurdle for more upward potential. That is why we assess the technical constellation as neutral this morning. However, it might turn bullish if Brent surpasses the resistances at 102.80 USD and 102.85 USD sustainably. Then the short-term uptrends might favor a test of the longer-term resistances.

U.S.

Nymex neutral: Oil futures edged higher in Asia and in electronic trading this morning having meanwhile breached some resistances despite disappointing economic indicators out of Germany. The traded volume at NYMEX is below average for this time of day. Traders are now waiting for the development at stock and forex markets, too. They will also keep a close eye on the situation in Ukraine, Iraq and Libya. There were also some economic indicators out of Germany due this morning and the DOE is going to release its data on US oil inventories at 4.30 p.m. this afternoon.

The analysts of the American Petroleum Institute say that crude oil and gasoline stocks in the USA declined in the week ending August 22. With refinery's having raised throughput, distillate stockpiles increased, however.

Although the summer season is slowly coming to an end, refinery run rates remain on a high level in the USA as particularly refineries in the south of the USA want to keep profiting from the good export margins. They thus process as much crude oil as possible ahead of the start of seasonal maintenance work in autumn. Overall crude oil stockpiles thus declined. Whilst the higher refinery utilisation caused builds in distillate stocks, gasoline inventories diminished increasingly sharply.

The bullish impact of the draw in crude oil inventories should be limited, though, as market players had expected far more massive draw. The builds in distillate stockpiles would be a bearish factor shortly ahead of the winter season but as the summer season is not really over yet, investors will keep focusing on gasoline, for now. Even though the sharp draw in gasoline stockpiles has been caused by exports, it leaves a bullish impression as the rise in refinery utilisation actually favors builds in product stocks.

Market players are now waiting for the DOE's report, which is going to be released at 4.30 p.m. this afternoon.

Houston (ex-wharf indications 26-8)
380cst $575
180cst $667
MGO $964

New Orleans (ex-wharf indications 26-8)
380cst $583
180cst $664
MGO $957

Singapore (delivered indications 27-8)

WTI is gaining sharply with +$0.73. Singapore paper is up with +$4.25 for 180cst and +$4.50 for 380cst for Sep, and for Oct 180 cst +$3.60 and 380cst with +$4.15 with MGO contracts Sep gaining with +$0.75 and in Oct with +$0.64. The cargo market is gaining with 180cst +$3.11, 380cst with +$1.41 and MGO with +$0.64.

The Singapore fuel oil prices rose between +$1.5 to +$3.0 during the Asian Platts window yesterday. The delivered bunker premiums slipped to between +$6.5 to +$8.5 above cargo prices on stronger outright prices. This morning both markets are trading higher.

380cst $585
180cst $597
MGO $863

Fujairah (delivered indications 27-8)

380cst $602
180cst $633
MGO $986

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $563
(1.0 %) : $568
180cst: $593
MGO 0.1%S: $832