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Brent and WTI oil prices traded near four-year lows this morning, amid growing speculation the Organization of the Petroleum Exporting Countries will not cut output to support the market when it meets on Thursday.

Oil futures at ICE and NYMEX orientated upward on Tuesday morning. Technical analysis was slightly bearish but didn't have a sustainable influence on prices due to the fact that market players are still waiting for the OPEC meeting and its result. Russia's alleged willingness to cut its production by 0.3 mbpd and the meeting in Vienna between Russia, Mexico, Venezuela and Saudi Arabia pushed futures upward. With engagements in long positions traders prepared for the case that these key producers came to an agreement about production cuts. But they didn't. The meeting came to an end without a concrete result but with the statement that they will keep observing the market and meet again in three months. Oil futures dropped in late trading and traders nervousness translated by an increase in volatility. The US oil inventory report as per API which was released last night at 10.30 p.m. was hardly recognized and hasn't sustainably influenced oil futures yet, especially as it didn't deliver any clear signals. Oil futures stay weak after an uneventful meeting of key producers and settled lower at fresh day lows in London and New York.

ICE Gasoil contract for December delivery settled at 694.25 USD on Tuesday, this is 12.50 USD below Monday's settlement. With some 47,900 deals the traded volume (front month) was below average.

The stochastic indicator stays bearish after yesterday's selling signals even though there are no fresh signals triggered this morning. The RSI stays at the neutral level without triggering any fresh signals to provide direction. After the breach of the lower limits of the short term uptrend and because of the stochastic's selling signals we still consider the technical constellation as neutral to bearish this morning. This constellation opens more downside but oil's slide is expected to be limited at first by yesterday's lows and subsequently by last week's long-term lows.

U.S.

Nymex above avarage: Yesterday's sharp price drop favores short covering this morning. Therefore, futures return from their Tuesday's lows without fresh signals. The traded volume at NYMEX is slightly above average at this time of the day. Market players are waiting for the European financial and the forex markets to open and will eye the situation in the geopolitical hotspots and the economic indicators which are to be released today, as well as the DOE data to be released this afternoon at 4.30 p.m.

Forecast: Crude oil +0.6; Distillates -0.2; Gasoline +0.9 million barrels vs previous week.
API: Crude oil +2.8; Distillates -1.3; Gasoline ±0.0 million barrels vs previous week.

Houston (ex-wharf indications 26-11)
380cst $422
180cst $512
MGO $831

New Orleans (ex-wharf indications 26-11)
380cst $447
180cst $501
MGO $811

Singapore (delivered indications 26-11)

WTI is losing with -$1.29 Singapore paper is down with -$8.00 for 180cst with -$7.40 for 380cst for Dec, and for Jan 180 cst -$8.25 and 380cst with -$7.80 with MGO contracts Dec bearish with -$0.80 and in Jan with -$0.80. The cargo market is losing with 180cst -$8.45, 380cst with -$8.85 and MGO with -$0.80.

380cst $470
180cst $485
MGO $715

Fujairah (delivered indications 26-11)

380cst $465
180cst $500
MGO $919