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WTI oil futures reclaimed the key $40-level this morning, as sentiment was boosted amid a global stock market rally.

The technical constellation already indicated on Wednesday morning that downward potential at oil markets has waned due to the losses oil futures marked at the beginning of this week. The Stochastic indicator generated a buying signal at the Brent and the WTI chart whereas market fundamentals didn't put as much pressure as usual on oil prices. The bullish data released by the API and the expansive measures of the Chinese central bank fostered oil futures. Since overall market sentiment and analysts' forecasts remained bearish, however, the bullish factors only lead to a consolidation but not to considerable gains. Moreover, traders waited for the DOE's data on US oil inventories. The DOE's report came in bearish sending oil futures at ICE and NYMEX lower again. Even so, losses remained limited as the supports at 38.55 USD WTI, 42.85 USD Brent and 420.75 USD Gasoil stayed strong. The traded volume was rather low late in the evening and the DOE's data wasn't enough to push prices below Tuesday's lows. Investors thus covered their short-positions and so Brent tested its resistance at 43.60 USD. When it exceeded this marker, further technical buying was triggered, the more so as the RSI gave a buying signal at the WTI chart.

ICE Gasoil contract for September delivery settled at 424.75 USD on Wednesday, this is -5.50 USD below Tuesday's settlement. With some 51,100 deals the traded volume (front month) was slightly below average.

After the lines of the Stochastic indicator had already crossed at the Brent and the WTI chart on Wednesday, the indicator remains bullish this morning. The RSI hasn't given a clear buying signal at the WTI chart yet. The indicators lead to expect that oil prices will consolidate within the boundaries of their downtrends. Market players might continue to cut their short positions, however, given the buying cues of the Stochastic indicator. That is why we assess the technical constellation as slightly bullish. As long as the trends remain intact and the MA 7 stays strong, upward potential should be limited though.

U.S.

Nymex above average: Oil futures have renewedly been bolstered by short covering this morning. The traded NYMEX volume is far above average at this time of day. Investors are now waiting for the European financial and forex markets to open as well as for the release of today's economic indicators.

Forecast: Crude oil +0.3; Distillates +1.1; Gasoline -1.1 million barrels vs previous week.
DOE: Crude oil -5.5; Distillates +1.4; Gasoline +1.7 million barrels vs previous week.
API: Crude oil -7.3; Distillates +1.5; Gasoline +0.1 million barrels vs previous week.

Houston (ex-wharf indications 27-8)
380cst $202
180cst $333
MGO $467

New Orleans (ex-wharf indications 27-8)
380cst $214
180cst $269
MGO $441

Singapore (delivered indications 27-8)

WTI is bullish with +$1.11. Singapore paper is up with +$10.00. for 180cst with +$9.50 for 380cst for Sep, and for Oct 180 cst +$9.75 and 380cst with +$9.00 with MGO contracts Sep gaining with +$1.00 and in Oct with +$1.08. The cargo market is bearish with 180cst -$2.56, 380cst with -$3.03 and MGO bullish with +$0.20.

380cst $204
180cst $211
MGO $404

Fujairah (delivered indications 27-8)

380cst $211
180cst $241
MGO $609

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:

380cst : $203
MGO 0.1%S: $403