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Crude oil held slightly weaker in Asia this morning as regional investors digested the implications of a build in U.S. stockpiles and the scope for demand globally.

Futures at ICE and NYMEX edged lower on Wednesday morning weighed down by bearish market fundamentals. The API's data on US oil inventories released Tuesday night penalized oil prices, as did the EIA's figures on US oil production for the agency had upwardly revised its data on US oil output. In addition to this, there were reports saying that OPEC-output significantly increased in June. From the technical perspective, ICE futures were buoyed by buying signals of the stochastic indicator that favoured short-covering in the course of the morning. Consequently, oil futures recovered around noon. Since the stochastic indicator didn't give a buying signal at the WTI chart, however, market fundamentals took the upper hand. The DOE's data on US oil stockpiles added to selling pressure in the afternoon. Even though the draw in gasoline stocks temporarily supported prices and some market players seized Gasoil's settlement phase to raise their long positions, oil prices eventually ended the day near their lows, posting considerable losses.

ICE Gasoil contract for July delivery settled at 572.25 USD on Wednesday, this is -1.50 USD below Tuesday's settlement. With some 37,900 deals the traded volume (front month) was below average.

As expected, the buying signals the stochastic indicator gave at the ICE charts on Wednesday didn't have much effect. Meanwhile, the indicator has turned neutral again. During yesterday's price decline, WTI dropped below the lower Bollinger Band. This does point to a consolidation. Even though the RSI might give a buying signal if it sustainably surpasses 30%, the stochastic indicator might also give a selling signal if the black line falls clearly below the red line. After the MA7 and the MA21 have crossed at the WTI chart, there is still a bearish bias for WTI. However, from a merely technical perspective, the constellation can be assessed as neutral at the moment.

U.S.

Nymex below average: After Wednesday's sharp losses, oil futures slightly recovered this morning, pulling back from yesterday's lows. This development is favoured by technical short-covering with WTI The traded volume at NYMEX is far above average at this time of the day. Investors are waiting for the European financial and forex markets to open, for the economic indicators that are on the agenda today.

Forecast: Crude oil -1.2; Distillates +1.1; Gasoline +0.1 million barrels vs previous week.
DOE: Crude oil +1.9; Distillates +0.3; Gasoline +0.3 million barrels vs previous week.
API: Crude oil +1.9; Distillates +0.3; Gasoline +0.3 million barrels vs previous week.

Houston (ex-wharf indications 2-7)
380cst $335
180cst $461
MGO $593

New Orleans (ex-wharf indications 2-7)
380cst $347
180cst $397
MGO $592

Singapore (delivered indications 2-7)

WTI is losing with -$0.73. Singapore paper is down with -$5.25 for 180cst up with -$6.50 for 380cst for Jul, and for Aug 180 cst -$6.25 and 380cst with -$5.00 with MGO contracts Jun losing with -$1.30 and in Jul with -$1.23. The cargo market is bearish with 180cst -$3.68, 380cst with -$0.61 and MGO down with +$0.35.

380cst $333
180cst $351
MGO $548

Fujairah (delivered indications 2-7)

380cst $333
180cst $358
MGO $733

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $328
MGO 0.1%S: $538