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WTI oil futures rebounded from the previous session's heavy losses this morning, as investors looked ahead to the release of U.S. weekly supply data.

After Friday's losses, the technical constellation for oil futures was bearish at the beginning of this week indicating that the supports would be tested. The economic data out of China released early on Monday was regarded as rather disappointing as the decline in imports points to a lower Chinese demand. Over the past few years China was the main driver of oil demand growth. Along with the bearish technical constellation, the unconvincing figures lead to a downward move at oil markets on Monday morning and so Brent and Gasoil approached the long-time lows they had hit last week. When the contracts finally dropped below these levels, new downward potential was generated. Market participants thus continued to bet on sinking prices. Around noon, the price level at oil markets stabilized but in the early hours of US trading selling pressure increased again pushing oil futures to new long-time lows. Prices were also weighed down by the renewed increase in Libya's oil output. The spokesman of the state-run National Oil Corporation (NOC) called on the other OPEC members, however, to adjust their production levels to the current situation. This spurred speculations that the cartel might cut its output. Whilst this slightly supported oil prices, the impact of the EU postponing the implementation of new sanctions was not easy to tell. In late trade oil futures pulled back from their long-time lows as investors covered their short-positions and so Brent climbed back up slightly above 100 USD.

ICE Gasoil contract for September delivery settled at 847.25 USD on Monday, this is -4.50 USD below Friday's settlement. With some 38,500 deals the traded volume (front month) was below average.

The stochastic indicator is still bearish at ICE and at NYMEX charts pointing to further tests of the downside. Still, there aren't any fresh cues at the moment. Probably, most of the selling pressure was already spent yesterday when oil futures declined and Brent broke below the psychological marker of 100 USD. This is also indicated by the fact that investors covered some of their short-positions in late trade. From a merely technical perspective, the bearish stochastic indicator is enough to still regard the situation as neutral to bearish.

U.S.

Nymex above avarage: After having hit new long-time lows on Monday and having seen an upward correction overnight, oil futures at ICE and NYMEX are currently edging lower again. The traded volume at NYMEX is slightly above average for this time of day. Investors are now eying the development at stock and forex markets. They will also keep focusing on the situation in Ukraine, Iraq and Libya and today's economic indicators. This evening, the EIA is going to release its monthly energy report and the API is going to release its data on US oil inventories (10.30 p.m.).

Forecasts: Crude oil -1.5; Distillates ±0.0; Gasoline million barrels vs previous week.

Houston (ex-wharf indications 9-9)
380cst $581
180cst $654
MGO $956

New Orleans (ex-wharf indications 9-9)
380cst $582
180cst $667
MGO $954

Singapore (delivered indications 9-9)

WTI is gaining with +$0.41 Singapore paper is up with +$1.70 for 180cst with +$2.00 for 380cst for Sep, and for Oct 180 cst +$1.25 and 380cst with +$1.25 with MGO contracts Sep losing with -$0.02 and in Oct with -$0.03. The cargo market is losing with 180cst -$7.06, 380cst with -$6.62 and MGO with -$1.88.

The Singapore fuel oil prices were similarly down app. -$6.5 during the Asian Platts window. The delivered bunker premiums were slightly stronger about +$10.0 above cargo prices as sellers are reluctant to sell at lower outright prices. There was a regional holiday in several Asian countries yesterday which also dampened demand.

380cst $575
180cst $587
MGO $845

Fujairah (delivered indications 9-9)

380cst $605
180cst $638
MGO $980

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $552
(1.0 %) : $562
MGO 0.1%S: $823