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Oil prices edged higher on Tuesday as falling U.S. and OPEC production tightened an oversupplied market.

Market fundamentals and the technical constellation were neutral on Monday morning. Currently, traders are increasingly talking about the sharp decline in US crude oil production which is widely expected. Since the number of active US oil rigs has sharply declined lately, oil output is expected to decline rather quickly, the more so as some US companies cut capital expanditures for 2016. The output losses in Nigeria and Iraq, caused by problems at pipeline, were bullish factors as well. Even though the overall situation remains bearish as the market is still oversupplied, this bolstered oil prices in the afternoon. The technical constellation didn't provide any clear signals although the Shooting star pattern might have a bearish impact. The bullish factors outweighed the bearish ones on Monday, with the changes in the front months of the ICE Brent and the NYMEX Heating Oil and Gasoline contracts made markets rather volatile. Market players covered their short-positions which eventually lead to a price increase despite data provider Genscape forecasting a 1.0 million barrel rise in Cushing crude oil stockpiles in the week ending February 26. Oil futures thus ended the day in the black.

ICE Gasoil contract for March delivery settled at 324.50 USD on Monday, this was 0.75 USD below Friday's settlement. With some 48,300 deals, the traded volume (front month) was below average.

Oil futures in London and New York are still trading in an uptrend. Neither the Stochastic indicator nor the RSI were able to give off fresh signals on Monday. This morning, however, the RSI might give off a selling signal at the Brent chart as the indicator has slipped below 70%. The lines of the Stochastic indicator are no longer diverging at the Brent and the WTI chart. If they cross, the indicator might give off a selling signal. The Shooting star candle which is regarded as a pattern indicating a change in the trend didn't have any effect on Monday. The supports remained strong, limiting the downward potential. However, the pattern might still have some impact at the WTI chart as the price of the US crude oil contract remained below Friday's highs. Currently, there are no clear signals at the ICE and NYMEX charts, which is why we are still assessing the technical constellation as neutral.

U.S.

Nymex above average: Oil futures tested Monday's highs in early electronic trading this morning, extending Monday's gains. The traded volume at NYMEX is far above average this morning. Market participants are now waiting for the European financial and forex markets to open as well as for the release of some economic indicators. Besides, the API will release its data on US petroleum stockpiles this evening at 10.30 p.m.

Houston (ex-wharf indications 1-3)
380cst $141
180cst $262
MGO $342

New Orleans (ex-wharf indications 1-3)
380cst $151
180cst $192
MGO $323

Singapore (delivered indications 1-3)

Brent is gaining with +$1.52 for Apr contracts. Singapore paper is up with +$9.30 for 180cst with +$9.00 for 380cst for Mar, and for Apr 180cst +$8.35 and 380cst with +$7.70 with MGO contracts Mar with +$1.62 and in Apr with +$1.45 .The cargo market is up with 180cst +$6.40, 380cst with +$6.81 and MGO with +$0.89.

380cst $159
180cst $168
MGO $298

Fujairah (delivered indications 1-3)

380cst $158
180cst $177
MGO $420

ARA(Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $153
MGO 0.1%S: $313