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Brent crude extended losses below $70 a barrel this morning and was set for a second weekly fall, with Saudi Arabia cutting prices in another indication it would maintain output in an oversupplied market.

The fundamentally bearish market situation and oil futures at ICE and NYMEX orientated downward in the early morning on Thursday. Wednesday's US oil inventory and the expected increase in Iraqi exports from January put the futures under pressure. Technical selling pressure increased due to the breach of further supports. Market volatility increased in the afternoon due to the ECB's press conference triggering some jumps in prices. But finally the bears predominated due to the news that Saudi Arabia will reduce its prices for January delivery to the United States and Asia. First rumours were spread after FS office hours, that the biggest Libyan oil fields Sharara will be reopened again - which is a further bearish argument for the current price development.

ICE Gasoil contract for December delivery settled at 622.00 USD on Thursday, this is 12.00 USD below Tuesday's settlement. With some 23,300 deals the traded volume (front month) was far below average.

The stochastic indicator's lines have already crossed at the Gasoil chart triggering first selling signals. A bearish signal is indicated at the Brent chart but will only be generated if the indicator's line sustainably crosses. The divergence between price development and stochastic indicator which is available at the Brent chart as well as at the WTI chart excludes a bullish influence. The RSI probably stays at the oversold level below the 30 line at ICE and NYMEX without any potential to trigger fresh signals. A considerable increase of technical selling pressure is expected if the stochastic indicator at the Brent and the WTI chart confirm the selling signal at the Gasoil chart. Currently, we consider the technical constellation as neutral to bearish but we would correct our consideration to bearish in case of confirming selling signals.

U.S.

Nymex above avarage: Oil futures at ICE and NYMEX consolidated on a low level in the early morning. Saudi Arabia's price reduction and the announced reopening of the Sharara oil field weigh on the futures but no further upward movement was triggered. The traded volume at NYMEX is 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 series of economic indicators which are to be released today.

Houston (ex-wharf indications 05-12)
380cst $396
180cst $501
MGO $767

New Orleans (ex-wharf indications 05-12)
380cst $421
180cst $482
MGO $751

Singapore (delivered indications 05-12)

WTI is losing with -$1.07 Singapore paper is down with -$7.00 for 180cst with -$6.50 for 380cst for Dec, and for Jan 180 cst -$4.50 and 380cst with -$3.75 with MGO contracts Dec bearish with -$1.11 and in Jan with -$1.24. The cargo market is losing with 180cst -$9.14, 380cst with -$8.54 and MGO with -$0.99.

380cst $422
180cst $435
MGO $645

Fujairah (delivered indications 05-12)

380cst $410
180cst $460
MGO $870

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $358
(1.0 %) : $370
MGO 0.1%S: $608