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Technical indicators: neutral to bearish

Oil prices eased during electronic trading due to the rising dollar, to rise slightly during electronic trading this afternoon, due to stronger equities. Conditioned by the American holiday and missing economic data analysts expect a quiet trade for today.

Oil prices shed earlier gains in after-hour trading as the dollar rose vs the euro.

OPEC trimmed its demand forecast for its members’ crude for this year as production from outside the group grew the most since 2002. OPEC, responsible for about 40 percent of global supplies, predicted in a monthly report today that the world will need 28.6 million barrels of oil a day from its 12 members this year. That’s about 100,000 barrels a day less than last month’s revised figure. The group is gathering in Vienna on Oct 14 for their next meeting.

ICE Gasoil October is expected to open 3.50 to 5.00 dollars lower at about 717.50 dollars/ton after settling at 722.75 dollars (official settlement price) Monday night. This was 1.00 dollars above Friday's settlement. Volume with some 42,700 deals on average.

Oil prices have installed themselves within the existing uptrend. The Stochastic indicator gives neutral signals, while the RSI is set to leave the overbought territory. Should the RSI breach the 70% line, a selling signal will be triggered. First WTI crude support line seen at 81.50 dollars today, first resistance line at 83.00 dollars.

U.S.

Nymex Access : Oil futures are easing in Asian trading hours and NYMEX electronic trading this morning, weighed down by a stronger dollar and a drop in Asian equities. No news in the markets. The traded volume is slightly above average.

Survey of US petroleum inventories API data will be released Wednesday, DOE data Thursday afternoon (both one day delayed) because of Monday's US holiday. crude oil +1.2; distillates -1.3; gasoline -1.2 million barrels vs previous week. Refinery utilization: +0.1%

Houston (ex-wharf indications 11-10)

380cst: $473
180cst: $493
MGO: $738

Very tight avails for 180cst

New Orleans (ex-wharf indications 11-10)

380cst: $475
180cst: $496
MGO: $742

Singapore (correct as of 1430hrs local time)

Crude is back on its bearish track with WTI -$1.69. Singapore paper is mirroring crude with 180cst -$5.60 and 380cst -$4.95 for Oct, and Nov 180 cst -$5.65 and 380cst -$5.55 with MGO Oct contracts -$0.99 and for Nov at -$1.10. The cargo market is reacting to last weeks sell off with 180cst +$5.93, 380cst +$6.28 and MGO +$1.54.

The Singapore fuel oil market came back up only app. $6 tracking the rebounded crude closing. Crude was pretty flat with US holiday on Monday. The delivered bunker premiums are up more than $1.0 above cargo prices.

High premiums for prompt deliveries:

380cst: $467
180cst: $476
MGO: $700

Fujairah (delivered indications 12/10)

380cst: $471
180cst: $489
MGO: $735

Rotterdam

Yesterday (Only barge trade deals of >2 KT reported) 14KT was traded in the MOC between 456.00-458.50 with Gunvor and Koch as the main sellers to Totsa as the main buyer.

Bullish crude movements despite the build in US stocks added to the relatively weak avails is keeping the HSFO markets firm. The East bound arbitrage seems to reach workable levels again, also underpinning the local markets. Two VLCC's are reported to be fixed for October loading one for Vitol's accounts, the other for RWE. Consequently healthy buying interest is being shown especially for bunker spec. THe market structure remains still though with Oct / Nov contango spread assessed at minus $1.75/mt, $0.25 weaker. The Fos Lavera strike situation is tightening things in the Med with the North-Med differential swap narrowing $3 on the day with demand strengthening in especially Gibraltar and Malta. Product length in the LSFO markets with the inbound US cargoes is weighing things down thereby exacerbating the cargo / barge differential. However the current storage situation may urge suppliers to make ullage.

380cst: $455
(1.0%): $472
180cst: $473
(1.0%): $492
DMB: N/A
MGO 0.1%S: $720