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Crude oil fell in Asian trade this morning, snapping gains that pulled prices back from testing 11-year lows, as investors awaited the outcome of a Federal Reserve meeting, where interest rates are likely to be raised.

Tuesday morning market fundamentals were less bearish than in the days before. Speculations over a lift of the export ban on US crude oil and the expectation of a draw in US crude oil inventories particularly fostered WTI, favouring short-covering. Whilst short-term fundamentals were bullish, oversupplies remained a bearish factor in the medium- and long-term. The technical constellation turned slightly bullish as the Stochastic indicator gave buying signals at the Brent and the WTI charts. This sent oil futures higher in the first half of the day. In the afternoon, trading at oil markets became more volatile. Still, oil futures were able to defend their gains, staying clearly above the lows they had hit in the morning. Eventually, the Stochastic indicator also gave off a buying signal at the Gasoil chart. The RSI also briefly exceeded 30% at the WTI chart providing more upside for oil futures. Even so, late in the evening oil futures tended to the downside again. The IAEA confirmed the agreement between the West and Iran on the Iranian nuclear programme, closing the file about the investigations into Iran's nuclear activity in the past. Although oil futures marked fresh highs once more after the Gasoil settlement at 5.30 p.m., they lost ground after the NYMEX settlement at 8.30 p.m.. The API's report on US oil inventories released at 10.30 p.m. left a rather bearish impression as it showed surprise builds in US crude oil stocks.

ICE Gasoil contract for January delivery settled at 345.75 USD on Tuesday, this is +14.50 USD above Monday's settlement. With some 86,900 deals, the traded volume (front month) was above average.

The Stochastic indicator at the Gasoil chart on Monday confirmed the buying signal it had given off at the Brent and the WTI charts. At the WTI chart, the indicator has meanwhile also exceeded 50%, remaining bullish. However, the RSI didn't give a buying signal as it is still moving below 30%. By surpassing the 7-period moving average, WTI generated fresh upward potential. This upward potential is still lacking at the Brent and the Gasoil chart. The technical constellation thus remains neutral to bullish this morning. If the RSI gives off buying signals and/or oil futures at ICE also exceed the 7-period moving average, the constellation might turn bullish. Selling pressure could increase if the lines of the Stochastic indicator don't drift further apart and if they possibly converge again.

U.S.

Nymex is above average: Oil futures edged higher in electronic trade this morning although this was merely a correction of the downward move they made after the release of the API's data on Tuesday evening. The trading ranges are rather narrow. The traded volume at NYMEX is slightly above average this morning. Market players are waiting for the European financial and forex markets to open today as well as for the release of a raft of economic indicators as well as for the FOMC's meeting results. Besides, they will eye the release of the DOE's data on US crude oil inventories which is due at 4.30 p.m. this afternoon.

Forecast: Crude oil -1.4; Distillates +1.6; Gasoline +1.3 million barrels vs previous week.
DOE: Crude oil +2.3; Distillates -1.8; Gasoline +0.1 million barrels vs previous week.

Houston (ex-wharf indications 16-12)
380cst $158
180cst $230
MGO $394

New Orleans (ex-wharf indications 16-12)
380cst $169
180cst $228
MGO $389

Singapore (delivered indications 16-12)

Brent is up with +$0.07 for December contracts. Singapore paper is bullish with +$1.25 for 180cst with -$1.25 for 380cst for Dec, and for Jan 180 cst -$1.00 and 380cst with -$1.25 with MGO contracts Dec with +$0.32 and in Jan with +$0.28 .The cargo market is bearish with 180cst -$3.50, 380cst with -$3.98 and MGO with -$1.63.

380cst $172
180cst $186
MGO $343

Fujairah (delivered indications 16-12)

380cst $168
180cst $202
MGO $594

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $152
MGO 0.1%S: $309