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Oil prices rose 5 percent this morning to scale the $30 mark breached last week, as cold U.S. and European weather as well as firmer financial markets gave traders reason to cash in on record short positions.

Technical selling pressure waned Thursday morning. However, market fundamentals remained bearish as fresh cues which might have justified an upward correction were lacking. In the first half of the day oil futures at ICE and NYMEX thus retreated but WTI and Brent stayed above Wednesday's lows. Until late afternoon oil futures consolidated near their lows. During the press conference following the meeting of the ECB's Governing Counsil Mario Draghi indicated further expansive measures (from March), IS-fighters renewedly attacked oil ports in Libya, Nigeria's oil minister renewedly pushed for an extraordinary meeting of the OPEC and Aserbaidjan's president signaled that his country was willing to cut output in a conjoint action with other producers. The bullish impact of such news remains limited as the market is clearly oversold. Since oil futures stayed above Wednesday's lows the news were enough to at least cause some short-covering ahead of the release of the DOE's report on US oil inventories. The DOE's data eventually triggered a price rally as market players focused on the bullish aspects. Thursday evening the Stochastic indicator generated fresh buying signals. In a technical price rally during which investors covered their short positions, oil futures surged to new highs.

ICE Gasoil contract for February delivery settled at 259.00 USD on Thursday, this is 11.75 USD above Wednesday's settlement. With some 83,200 deals, the traded volume (front month) was above average.

The lines of the Stochastic indicator crossed at ICE and NYMEX charts Thursday evening. The RSI surpassed 30% this morning at the Brent and the WTI chart, confirming the bullish signals. In the course of the day the RSI might give a buying signal at the Gasoil-chart as well. The technical constellation can thus be assessed as bullish this morning. As the market is oversold, many investors might tend to cover their short-positions, the more so as Brent and WTI breached their 7-period moving averages, which had been key resistances.

U.S.

Nymex above average: Oil futures kept track of their gains in electronic trading this morning fostered by technical buying. Meanwhile, oil futures have already climbed to new highs. The traded volume at NYMEX is far above average this morning. Investors are now waiting for the European financial and forex markets to open and the economic indicators due today.

Forecast: Crude oil +2.3; Distillates -0.6; Gasoline +1.1 million barrels vs previous week.
DOE: Crude oil +4.0; Distillates -1.0; Gasoline +4.6 million barrels vs previous week.
API: Crude oil +4.6; Distillates +1.5; Gasoline +4.7 million barrels vs previous week.

Houston (ex-wharf indications 22-1)
380cst $115
180cst $189
MGO $328

New Orleans (ex-wharf indications 22-1)
380cst $131
180cst $178
MGO $329

Singapore (delivered indications 22-1)

Brent is up with +$2.64 for March contracts. Singapore paper bullish with +$12.25 for 180cst with +$11.70 for 380cst for Jan, and for Feb 180 cst +$12.00 and 380cst with +$12.20 with MGO contracts Jan with +$2.99 and in Feb with +$2.93 .The cargo market is bullish with 180cst +$7.01, 380cst with +$6.40 and MGO with -$0.92.

380cst $148
MGO $252

Fujairah (delivered indications 22-1)

380cst $141
MGO $454

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $138
MGO 0.1%S: $255