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Crude oil fell 3 percent this morning, heading toward $30 per barrel and levels not seen in over a decade, with analysts scrambling to cut their price forecasts and traders betting on further declines.

Once again, market fundamentals and the technical constellation were bearish on Monday morning. On Friday, oil futures were temporarily bolstered by short-covering ahead of the weekend but Gasoil nonetheless dropped to a fresh 12-year-low Friday evening. Early Monday morning, WTI and Brent dropped below Friday's lows which triggered further downward potential. Although oil futures remained rather stable until the afternoon, analysts at Société Générale and Macquarie cut their price forecasts. In addition to this, Morgan Stanley announced that it no longer excludes a price slump down to the level between 20 and 25 USD. When oil futures on the ICE and NYMEX fell below the lows they had hit earlier in the day, prices sharply declined. In the evening oil futures thus hit fresh 12-year lows, weighed down by the bearish fundamentals and the technical constellation. Eventually, oil futures settled near these lows.

ICE Gasoil contract for January delivery settled at 289.25 USD on Monday, this is -7.50 USD below Friday's settlement. With some 50,200 deals, the traded volume (front month) was slightly below average.

After the Stochastic indicator had already been bearish at the Gasoil chart on Monday, the selling signal of the indicator was also confirmed at the Brent and the WTI chart. Oil futures have already dropped below Monday's lows triggering further technical selling. WTI and Brent are now approaching the psychologically important mark of 30.00 USD. This level might be a price target for technical analysts this week. From a technical perspective, we assess the situation as bearish, with crude oil futures possibly testing their support at 30.00 USD. However, oil futures are trading far below the lower Bollinger Band. Moreover, the RSI and the Stochastic indicator are in oversold territory. This might prompt investors to cover their short positions in case oil futures bounce from their key support or the indicators provide a clear signal.

U.S.

Nymex above average: Oil futures hit fresh 12-year-lows in East Asia and Globex electronic trading this morning, put under pressure by the bearish technical constellation and market fundamentals. The traded volume at NYMEX is far above average this morning. Market participants are waiting for the European financial and forex markets to open today, as well as for the release of some indicators out of the USA. Moreover, the API's report is due tonight at 10.30 p.m.

Houston (ex-wharf indications 12-1)
380cst $137
180cst $185
MGO $358

New Orleans (ex-wharf indications 12-1)
380cst $161
180cst $225
MGO $367

Singapore (delivered indications 12-1)

Brent is down with -$1.73 for March contracts. Singapore paper is bearish with -$4.50 for 180cst with -$5.25 for 380cst for Jan, and for Feb 180 cst -$5.65 and 380cst with -$5.35 with MGO contracts Jan with -$2.10 and in Feb with -$2.04 .The cargo market is bullish with 180cst -$10.09, 380cst with -$9.95 and MGO with -$1.54.

380cst $160
180cst $164
MGO $308

Fujairah (delivered indications 12-1)

380cst $144
180cst $172
MGO $499

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $113
MGO 0.1%S: $273