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Oil prices slid for a second day this morning, under pressure from signs that some of the nimbler U.S. producers increased drilling last week and from uncertainty surrounding a meeting of the world's major exporters next month to discuss freezing output.

Whilst market fundamentals were neutral for oil markets on Friday morning, the technical constellation favoured further tests of the upside. After having tested their supports, oil futures regained ground around noon, still slightly bolstered by the Stochastic indicator and the weaker dollar. However, the price increase was capped when Brent found strong resistance near 42.50 and 42.60 USD. Since bullish news was lacking, oil futures failed to extend their gains. That is why they shed nearly all of their earlier gains in the afternoon. In the evening, Baker Hughes released its weekly rig count. The report showed that the number of active US oil rigs had risen for the first time in 13 weeks. Oil futures, NYMEX Crude Oil in particular, retreated on the data. WTI dropped back below 40 USD, dragging the other contracts down as well. Oil futures in London and New York thus erased earlier gains, ending the day slightly in the red.

ICE Gasoil contract for April delivery settled at 375.00 USD on Friday, this was 0.25 USD below Thursday's settlement. With some 53,900 deals, the traded volume (front month) was about on average.

Oil futures have dropped below Friday's highs, indicating more tests of the downside. Neither the Stochastic indicator, nor the RSI are currently giving off any fresh cues. The Stochastic indicator might give off a selling signal in the course of the day, if its lines cross. If oil futures break below the 7-period moving average, the technical selling pressure might increase as well. Although there are no clearly bearish signals, oil futures' break below Friday's lows is pointing to more tests of the downside. Possible selling signals would add to bearish momentum. That is why we assess the technical constellation as slightly bearish this morning. Moreover, at the Brent chart, the candlestick pattern of a Shooting Star has developed. This bearish pattern is confirmed if the contract stays below Friday's high.

U.S.

Nymex above average: Oil futures have already dropped below Friday's lows, testing their downside in electronic trading this morning. The traded volume at NYMEX is above average this morning, with investors focusing on the contract with delivery in May. Market players are now waiting for the European financial and forex markets to open as well as for the release of the economic indicators due today. Moreover, they are waiting for comments on a possible output freeze by OPEC and non-OPEC producers. .

Houston (ex-wharf indications 21-3)
380cst $169
180cst $283
MGO $381

New Orleans (ex-wharf indications 21-3)
380cst $173
180cst $218
MGO $372

Singapore (delivered indications 21-3)

Brent is bearish with -$0.60 for Apr contracts. Singapore paper is down with -$2.90 for 180cst with -$2.75 for 380cst for Mar, and for Apr 180cst -$3.15 and 380cst with -$3.05 with MGO contracts Apr with -$0.82 and in May with -$0.80.The cargo market is down with 180cst -$1.24, 380cst with -$0.61 and MGO with +$17.

380cst $182
180cst $187
MGO $346

Fujairah (delivered indications 18-3)

380cst $177
180cst $197
MGO $423

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $163
MGO 0.1%S: $368