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Crude oil prices rebounded in Asia on this morning, with supplies dipping sharply overnight.

After trading remained rather calm on the US Labor Day holiday on Monday, on Tuesday investors were waiting for the return of the US market players. Oil futures still tended to the downside on Tuesday morning as Monday's economic data out of China and the Eurozone were unconvincing and the technical constellation was already neutral to bearish on Tuesday morning. Investors at oil markets thus took some profits in morning trade following the example of the (European) traders that had already on Monday cut the strategic long positions they had raised ahead of the long US-weekend. At the WTI chart, the stochastic indicator and the RSI soon confirmed the selling signal the RSI had given at the Gasoil chart. At the Brent chart, the stochastic indicator provided a selling signal, too, and so technical selling pressure continued to rise indicating that oil futures would keep track of their losses in the afternoon. Even though the economic indicators out of the USA were uplifting once again, this didn't really keep oil prices from retreating. In late-evening trade, oil futures dropped lower and lower. Brent and Gasoil even hit new 14- resp. 15-month-lows. WTI, however, stayed above this year's low hit at the end of August.

ICE Gasoil contract for September delivery settled at 854.50 USD on Tuesday, this is -9.00 USD below Monday's settlement. With some 50,700 deals the traded volume (front month) was on average.

The lines of the stochastic indicator crossed at the Brent and the WTI chart yesterday giving fresh selling signals. In addition to this, the RSI slipped below 70% at the WTI chart confirming the selling signal it had given at the Gasoil chart in the morning. Given yesterday's decline, oil futures have already spent much of their downward potential. Brent and Gasoil even dropped below this year's low and further long-time lows. This generated more downward potential. Even though the RSI has already entered oversold territory at the Brent chart, the indicators altogether are still bearish today. After such hefty losses investors usually tend to cover their short positions but as Brent might test its support at 100 USD and as the technical factors are as described, we assess the technical constellation as bearish.

U.S.

Nymex below avarage: Oil futures pulled back from yesterday's long-time lows in Asian and electronic trading this morning. Still, this short-covering can't be regarded as a clear counter-reaction, yet. Prices are rather consolidating on a low level. The traded volume at NYMEX is far below average for this time of day. Market players are now eying the development at stock and forex markets. They will also keep a close eye on the situation in Ukraine, Iraq and Libya and today's economic indicators. Moreover, the API is going to release its data on US oil inventories at 10.30 p.m. this morning.

Forecasts: Crude oil -1.0; Distillates -1.2; Gasoline -1.5 million barrels vs previous week.

Houston (ex-wharf indications 3-9)
380cst $578
180cst $654
MGO $963

New Orleans (ex-wharf indications 3-9)
380cst $579
180cst $667
MGO $956

Singapore (delivered indications 3-9)

WTI is losing with -$2.25 Singapore paper is down with -$5.65 for 180cst and -$5.50 for 380cst for Sep, and for Oct 180 cst -$5.60 and 380cst with -$5.00 with MGO contracts Sep losing with -$1.42 and in Oct with -$1.39. The cargo market is losing with 180cst -$7.21, 380cst with -$6.16 and MGO with -$0.48.

The Singapore fuel oil prices fell more than -$6.0 during the Asian Platts window. The delivered bunker premiums were seen around +$7.0 to +$8.5 above cargo prices. Bunker fuel oil swaps lost nearly $7/mt for the front month contracts both for Rotterdam and Singapore papers. The backend of the forward curve was slightly stronger with 2015 papers down app.$4/mt.

380cst $582
180cst $595
MGO $860

Fujairah (delivered indications 3-9)

380cst $608
180cst $633
MGO $980

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $561
(1.0 %) : $571
180cst: $591
MGO 0.1%S: $833