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WTI oil futures recovered from 12-year lows this morning, amid speculation weekly supply data due later in the session will show U.S. crude inventories fell last week.

The technical constellation and market fundamentals were bearish for oil futures in London and New York on Tuesday morning. This pointed to further tests of the downside. Reports on two OPEC members having made formal proposals for an extraordinary meeting of the cartel, the change in the Gasoil front month and a technical buying signal at the NYMEX Gasoline chart prompted investors to cover their short positions around noon but the price increase wasn't sustainable. In the afternoon the bearish constellation took the upper hand again, making oil futures test earlier lows. On the one hand an extraordinary OPEC meeting is rather unlikely as all members of the cartel would have to agree to it. On the other hand, traders had already eyed the 30 USD mark. When WTI lost ground in the evening, it briefly slipped below this level. However, investors renewedly covered their short positions and so the contract rebounded from this key support. After our office hours, the EIA released its most recent monthly energy report, which can be assessed as clearly bearish. The API at 10.30 p.m. released data on US petroleum stockpiles, which also had a slightly bearish impact. Even though oil futures bounced off important supports on Tuesday evening, the failed to clearly pull back from their fresh 12-year lows.

ICE Gasoil contract for February delivery settled at 292.50 USD on Tuesday, this is -6.75 USD below Monday's settlement. With some 104,500 deals, the traded volume (front month) was far above average.

WTI has bounced off its support at 30 USD staying near this level, though. The US crude oil contract might renewedly test this mark. Meanwhile, neither the Stochastic indicator nor the RSI are giving off any fresh buying signals. They are neutral at the ICE and NYMEX charts. The Stochastic indicator has thus lost its bearish impact. Since the Stochastic indicator and the RSI are deeply in oversold territory, the likelyhood of buying signals and short-coverings increases, though. Moreover, WTI on Tuesday settled below the lower Bollinger Band for the second consecutive day. That is why the contract might consolidate above this level even though it doesn't necessarily have to see an upward correction. If the Stochastic indicator and the RSI give off buying signals, however, oil futures might indeed see a sharp rise. Since there currently are no indications for such signals and the selling signal of the Stochastic indicator has waned, we assess the technical constellation as neutral this morning. The 30 USD-mark remains a key support.

U.S.

Nymex above average: Oil futures remained rangebound in East Asia and Globex electronic trading this morning, after investors had covered some of their short positions overnight. The traded volume at NYMEX is far above average this morning. Investors are waiting for the European financial and forex markets to open today, as well as for the release of the data on industrial production in the Eurozone. Moreover, the DOE will release its report on US oil inventories at 4.30 p.m.

Forecast: Crude oil +2.1; Distillates +1.3; Gasoline +1.9 million barrels vs previous week.
API: Crude oil -3.9; Distillates +3.7; Gasoline +7.0 million barrels vs previous week.

Houston (ex-wharf indications 13-1)
380cst $126
180cst $201
MGO $345

New Orleans (ex-wharf indications 13-1)
380cst $146
180cst $203
MGO $347

Singapore (delivered indications 13-1)

Brent is down with -$0.01 for March contracts. Singapore paper is bearish with -$2.55 for 180cst with -$2.75 for 380cst for Jan, and for Feb 180 cst -$1.75 and 380cst with -$2.15 with MGO contracts Jan with -$0.12 and in Feb with -$0.09 .The cargo market is bullish with 180cst -$5.38, 380cst with -$5.96 and MGO with -$2.16.

380cst $152
180cst $156
MGO $284

Fujairah (delivered indications 13-1)

380cst $139
180cst $167
MGO $476

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $118
MGO 0.1%S: $278