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Crude oil prices rebounded smartly in early Asia this morning as investors pulled back from recent bearish sentiment on supply.

Futures at ICE and NYMEX followed the fundamentally and technically bearish aspects and tested their downside on Thursday morning. An important psychologic support is at 80 USD at the WTI chart which was temporarily breached. Market players stay cautious after the release of the encouraging U.S. economic data, expecting the DOE's U.S. oil inventory report and limiting the downside by covering their short positions. The DOE's data was not as bearish as the API had announced the night before. Especially the decrease in oil products was interpreted bullish, the more as demand increased in the U.S. last week. In combination with the positive U.S. economic data, the expiry of Brent's front month and the still stable support at 80 USD WTI further short-covering could be realized. This resulted in a strong upward movement at the oil market, so that prices settled higher in London and New York.

ICE Gasoil contract for November delivery settled at 726.25 USD on Thursday, this is 6.50 USD below Wednesday's settlement. With some 100,200 deals the traded volume (front month) was far above average.

The stochastic indicator's lines last night crossed at the ICE chart as well as at the NYMEX chart and gave buying signals to the market players. The RSI couldn't breach the 30 line and stays neutral. A part of the stochastic's buying signals was already absorbed by yesterday's strong price increase at the oil market. The RSI missed to cross the 30 line which would have given a confirming buying signal. Due to the stochastic indicator's buying signals we consider the technical constellation as neutral to bullish this morning. Should these buying signals be confirmed by the RSI during the day, the bullish side would gain strength and the correction movement will continue. But jf the stochastic indicator's lines start to converge, the bearish side will dominate as long-term downward trends are basically still seen intact.

U.S.

Nymex above avarage: After a late rally in prices futures at ICE and NYMEX are trading lower in electronic Globex trade but still in a narrow range. The traded volume is far above average at this time of day. Market players are waiting for the European financial and the exchange market to open and will eye the situation in the geopolitical hotspots and the economic indicators to be released today.

Forecast: Crude oil +2.5; Distillates -1.7; Gasoline -1.6 million barrels vs previous week.
DOE: Crude oil +8.9; Distillates -1.5; Gasoline -4.0 million barrels vs previous week.
API: Crude oil +10.2; Distillates -0.2; Gasoline -3.1 million barrels vs previous week.

Houston (ex-wharf indications 17-10)
380cst $475
180cst $576
MGO $856

New Orleans (ex-wharf indications 17-10)
380cst $482
180cst $569
MGO $853

Singapore (delivered indications 17-10)

WTI is gaining with +$2.27 Singapore paper is up with +$15.50 for 180cst with +$15.25 for 380cst for Nov, and for Dec 180 cst +$14.75 and 380cst with +$14.25 with MGO contracts Nov gaining with +$2.00 and in Dec with +$2.04. The cargo market is losing with 180cst -$4.18, 380cst with -$5.75 and MGO with -$0.86.

The Singapore fuel oil prices extended losses by more than -$4.0 during the Asian Platts window tracking weak crude. The Singapore physical market saw strong selling of the cargoes with delivered bunker premiums coming under pressure and weakening to $5.5-4.25 above cargo prices.

380cst $474
180cst $490
MGO $730

Fujairah (delivered indications 17-10)

380cst $480
180cst $525
MGO $940

ARA (Amsterdam - Rotterdam - Antwerp)

Tight avails untill the 22nd

Indications for delivered bunkers:
380cst : $463
(1.0 %) : $483
MGO 0.1%S: $728