---

Oil rose above $60 a barrel this morning for the first time this year, bringing its gain this week to almost 4 percent, supported by signs that deeper industry spending cuts may curb excess supply.

Like in the past few weeks, market fundamentals were still bearish for oil markets on Thursday. The technical indicators favoured tests of the downside as well. Even so, we had already forecast in our early morning news that the indicators might have no larger impact as the expiry of the Gasoil contract with February delivery and Brent with delivery in March might prompt investors to cover their short positions. And investors did so. Since the Gasoil contract expired in the early afternoon, oil futures already gained ground in the first half of the day. Many market participants still held short positions which they cut before the expiry of the contract. This generated technical bull pressure that temporarily waned in the early afternoon. The CEO of Royal Dutch Shell PLC warned that the oil boom might be over sooner than many market players might expect and that oil demand growth might outpace supply growth in 2015. Along with the sharply rising euro (vs. the dollar), the cold weather in the USA, the strike of refinery workers and further short covering ahead of the expiry of Brent (Thursday evening), a combination of bullish factors developed, adding to momentum at oil markets in the course of the afternoon. Futures exceeded several resistances, automatically triggering more technical buying orders and accelerating the rise. The Brent contract with delivery in April (new front month) was pushed up to the 60.00 USD-bar in late trade and so oil futures over all settled with considerable gains.

ICE Gasoil contract for March delivery settled at 562.50 USD on Thursday, this is 18.25 USD above Wednesday's settlement. With some 118,700 deals the traded volume (front month) was far above average.

The bias of the technical constellation has changed compared to yesterday. The lines of the stochastic indicator have crossed at the Brent and the Gasoil charts, providing fresh buying cues. This bullish signal hasn't been confirmed yet at the WTI chart. The RSI is still bearish at the Brent chart but it doesn't give any fresh signal. That is why the technical constellation points to more tests of the upside, with a neutral to bullish bias. Brent has meanwhile breached its former key-resistance at 60.00 USD but, so far, this hasn't generated more upward potential. If the stochastic indicator at the WTI chart confirms the buying signals it has already given at the ICE charts, the technical constellation would turn clearly bullish. The latest rise in oil futures was also due to short covering, however. Therefore, the stochastic indicator at the ICE charts might be skewed to the upside. The technical situation is thus rather unstable, the more so as the RSI might give a selling signal at the Gasoil chart as well if it drops below 70%.

U.S.

Nymex above average: Oil futures held steady in electronic trading this morning, rising above Thursday's highs. Brent has meanwhile climbed slightly above its key-resistance at 60.00 USD as well. The traded volume at NYMEX is above average at this time of the day. Investors are waiting for the European financial and the forex markets to open, for news concerning the strikes at US oil refineries and the economic indicators which are to be released today, especially the Eurozone's GDP.

Houston (ex-wharf indications 13-2)
380cst $333
180cst $401
MGO $627

New Orleans (ex-wharf indications 13-2)
380cst $339
180cst $374
MGO $618

Singapore (delivered indications 13-2)

WTI is gaining with +$4.25. Singapore paper is up with +$20.75 for 180cst with +$20.00 for 380cst for Feb, and for Mar 180 cst +$22.05 and 380cst with +$21.55 with MGO contracts Feb bullish with +$3.45 and in Mar with +$3.57. The cargo market is bullsh with 180cst +$2.12, 380cst with +$1.55 and MGO bearish with -$0.33.

380cst $349
180cst $370
MGO $551

Fujairah (delivered indications 13-2)

380cst $346
180cst $365
MGO $758

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $323
MGO 0.1%S: $563