---

Oil futures gave up early gains to trade near three-month lows this morning on a persistent supply glut that has cut prices by up to 13 percent since the start of November.

Oil futures at ICE and NYMEX rose in electronic morning trading on Thursday, extending Wednesday's late gains that were registered after the WTI had rebounded from its 40 dollar 40 dollar 40 dollar key support. The gasoil contract at the ICE rose more strongly than the other contracts when bets on a rising demand because of the change in the weather in Europe and the U.S. lent support. Still, analysts stay bearish on oil, prices at ICE and NYMEX still trading within their existing downtrends and below their 7-day moving average lines. As for the fundamentals, the constant increase in stocks that lead to an exhaustion of the storage capacities, persistent oversupply and the prospect of additional barrels from Iran flooding the market lead analysts to presume that the WTI contract might eventually fall below its symbolic support. Consequently oil prices in London and New York lost all of the ground gained earlier at noon, hitting fresh intraday lows. Yet the support once again proved strong despite comments of Genscape of another expected build in Cushing crude stocks and traders covered their short positions which helped prices up in late trading.

ICE Gasoil contract for November delivery settled at 427.00 USD on Thursday, this is 4.50 USD above Wednesday's settlement. With some 75.800 deals the traded volume (front month) was above average

The Stochastic indicator is slightly bullish at the ICE charts this morning as its two lines are diverging. Yet a clear buying signal has not been triggered as the lines have not crossed. At the Brent chart the 7-day moving average line that limits the contract's upside is still strong. In case the line is breached a buying signal would be triggered similar to that produced at the gasoil chart. At the Brent chart a technical triangle has formed that, if breached, determines the direction in which prices will move. At the WTI chart a descending triangle has formed that signals a confirmation of the downward trend and further tests of the 40 dollar40 dollar support. The technical constellation stays unstable as short covering seen ahead of tonights expiry of the WTI front month and before the weekend will lend support while a fall of the contract below the mark would trigger a strong selling signal. Given the bullish signals at the ICE charts we consider the technical constellation as neutral to bullish this morning, but like to point out that the situation might change any time should the corresponding signals be triggered.

U.S.

Nymex is above average: Oil futures are trading in a very narrow range at settlement level in East-Asia and electronic Globex trade this morning in a market without direction. The traded volume at NYMEX is about on average this morning while the volume of the January contract is meanwhile much higher than that of the front month, the contract for December delivery expiring tonight. Investors are waiting for the European financial and forex markets to open today and for the release in the afternoon of a single euro zone indicator. They will also eye the Baker Hughes rig count to be released after office hours.

Houston (ex-wharf indications 20-11)
380cst $201
180cst $281
MGO $447

New Orleans (ex-wharf indications 20-11)
380cst $212
180cst $265
MGO $445

Singapore (delivered indications 20-11)

Brent is down with -$0.39 for December contracts. Singapore paper is down with -$3.00 for 180cst with -$3.25 for 380cst for Dec, and for Jan 180 cst -$2.75 and 380cst with -$3.10 with MGO contracts Dec with -$0.25 and in Jan with -$0.26 .The cargo market is bullish with 180cst +$2.79, 380cst with +$2.22 and MGO with up +$0.26.

380cst $218
180cst $232
MGO $420

Fujairah (delivered indications 20-11)

380cst $218
180cst $258
MGO $604

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $198
MGO 0.1%S: $388