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Crude oil gained in early Asia this morning with investors focused on U.S. stockpile estimates from the American Petroleum Institute later in the day.

Oil futures in London and New York tended to the downside on Monday morning. Whilst fresh technical cues were lacking, market players weighed the bearish short-term outlook against the expectations that the oil market might rebalance in 2016. Disappointing Chinese indicators released at the weekend (construction spending and industrial production) penalised oil futures - as did the price battle between OPEC member countries. Many members of the cartel have meanwhile cut their selling prices for October deliveries to defend or regain market share. In the afternoon, OPEC released its monthly energy report, raising its forecast for 2015 oil demand growth but cutting its expectations for 2016. Forecasts for the demand for OPEC oil were upwardly revised for both 2015 and 2016. Over all, the cartel's report came in less bullish as the IEA's data had led to expect. That is why the report failed to push oil futures notably higher. Analysts' short-term bearish outlook predominated in the course of the day. Many of them had cut their price forecasts for 2015 and 2016 last week. Oil futures at ICE dropped below the MA21 on Monday, generating more downward potential. That is why ICE futures settled with sharp losses and fresh lows whereas WTI didn't lose that much ground. Traders took advantage from WTI's price decline to cover some of their short-positions. So, the US crude oil contract was able to recover at the end of the day.

ICE Gasoil contract for October delivery settled at 464.25 USD on Monday, this is -8.50 USD below Friday's settlement. With some 69,100 deals the traded volume (front month) was far above average.

The lines of the Stochastic indicator have crossed at the WTI, the Brent and the Gasoil charts, providing fresh selling signals this morning. Moreover, oil futures at ICE have dropped below the MA21, generating more downward potential. WTI is still trading above this level but it might generate yet another selling signal in the course of the day if it sustainably breaks below this level. More technical selling might be triggered if the moving averages at ICE charts cross. Due to the bearish signal of the Stochastic indicator, the technical constellation has a bearish bias. The fact that WTI is still trading above the MA21 and that the moving averages might provide more bearish cues prompts us to assess the technical constellation as merely neutral to bearish for the time being. The bearish bias might become much stronger, however, if the potential selling signals mentioned above materialize.

U.S.

Nymex above average: Oil futures at ICE have already headed for Monday's lows this morning but failed to break below them. WTI is bolstered by Monday evening's short-covering. The traded NYMEX volume is above average at this time of day. Investors are waiting for the European financial and forex markets to open and for a raft of economic indicators that are on the agenda today. They are also eying the API's data on US petroleum stockpiles due at 10.30 p.m. tonight. We will publish this data on our website on Wednesday morning.

Houston (ex-wharf indications 15-9)
380cst $227
180cst $339
MGO $489

New Orleans (ex-wharf indications 15-9)
380cst $237
180cst $289
MGO $468

Singapore (delivered indications 15-9)

WTI is bearish with -$0.83. Singapore paper is down with -$2.50 for 180cst with -$2.75 for 380cst for Sep, and for Oct 180 cst -$3.50 and 380cst with -$3.25 with MGO contracts Sep losing with -$0.82 and in Oct with -$0.93. The cargo market is bullish with 180cst +$3.06, 380cst with +$1.68 and MGO with -$0.11.

380cst $226
180cst $239
MGO $440

Fujairah (delivered indications 15-9)

380cst $228
180cst $247
MGO $569

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $219
MGO 0.1%S: $433