Technical indicators: neutral to bullish
Yesterday, oil prices were supported by a weaker dollar throughout the day. With a higher than expected oil demand for 2010 and 2011, IEA and EIA reports of today gave also positive impulses to the already bullish market. Oil prices than breached resistance lines and further technical buyings were triggered. Oilprices breached the technical triangle upwards and the stochastic indicator is giving a buying signal now, see charts. Oil prices are in a bullish trend. First WTI crude support line seen at 82,50 dollars today, first resistance line at 84.50 dollars.
Oil prices are seen edging higher today within the existing trendchannel, supported by the weak dollar and bullish fundamentals from Europe and the USA. Should the DOE data also be bullish, as the latest API data, prices will continue their rise. Important resistant line for WTI crude is seen at 85,00 dollars.
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 0,50 to 2,00 dollars higher at about 726,75 dollars/ton after settling at 725,50 dollars (official settlement price) Wednesday night. This was +12,25 dollas above Tuesday's settlement. Volume with some 90.700 deals well above 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.
Strike in France: The French strike halting shipments in and out of the Fos-Lavera oil terminal on the Mediterranean may cause shortages of fuel, the International Energy Agency said in its monthly report. “By some estimates the strike could continue during the next two weeks and lead to product shortages,” the Paris-based agency said. “The strike is pushing European product cracks and refining margins higher, drawing in products from abroad and likely encouraging other refiners to increase run rates.” The port closure started on Sept. 27 and cut crude supply to six refineries in France and one in Switzerland, which are all now running at reduced rates, the IEA said. This week has seen more French refinery workers strike in protests against national pension reform. So far, the lost production is being replaced by commercial stocks within France, the IEA said.
US economy: US import prices declined by 0.3% in September, when economists were expecting import prices to decrease by 0.1%. Export prices rose by 0.6%.
U.S.
Nymex Access : Oil futures are rising further in Asian trading hours and NYMEX electronic trading this morning, due to a stronger euro, which breached the 1,4050 dollar line yesterday. No news in the markets. The traded volume is above average. Traders waiting for US economic data and DOE data.
APIs: crude oil -4.007; distillates -0.254; gasoline -1.883 million barrels vs previous week. Refinery utilization -1.5 % = 80.1%
crude oil +1.2; distillates -1.3; gasoline -1.2 million barrels vs previous week. Refinery utilization: +0.1%
Houston (ex-wharf indications 13-10)
380cst: $477
180cst: $497
MGO: $742
Very tight avails for 180cst
New Orleans (ex-wharf indications 13-10)
380cst: $479
180cst: $498
MGO: $746
Singapore (correct as of 1430hrs local time)
Crude is bullish after the stock reports with WTI +$0.97. Singapore paper is not really buying into the renewed bullishness with 180cst +$0.45 and 380cst +$0.35 for Oct, and Nov 180 cst +$0.15 and 380cst +$1.30 with MGO Oct contracts +$1.08 and for Nov at +$1.09. The cargo market is still reacting to the previous day's move up with 180cst +$5.46, 380cst +$5.96 and MGO +$1.09.
The Singapore fuel oil market extended its gain by more than $5 as crude was strong during the Platts window. The intermonth spreads were heavily traded and speculated by the various players which weakened on heavy selling. The Asian fuel oil crack continued to weaken as strength in crude over current fuel oil weakness.
High premiums for prompt deliveries:
380cst: $472
180cst: $480
MGO: $719
Fujairah (delivered indications 14/10)
380cst: $478
180cst: $498
MGO: $742
Rotterdam
Yesterday (Only barge trade deals of >2 KT reported) 16KT was traded in the MOC between 458,50-461.00 with Gunvor as the main seller to mixed buyers.
More than 100,000 mt of spot residual fuel oil was slated to move to the Mediterranean market from Northwest Europe as companies took advantage of a rare arbitrage opportunity between the two markets. As a result, that product flow into the Med from the five ships heard fixed Tuesday narrowed the Med-NWE spread by $3/mt to $3.25/mt Wednesday. Platts assessed FOB Rotterdam barges at $460.50/mt and FOB Med cargoes at $463.25/mt. A well-supplied NWE and a comparatively short-supplied Med resulted in Med FOB cargoes—typically seen at a discount to FOB Rotterdam barges—being assessed at a premium as wide as $6.50/mt for a fourth straight day. A strike at the French oil terminal Lavera, now in its seventeenth day, as well as a general lack of high sulfur FO offerings, had added to the Med region’s tightness. In the low sulfur FO market, participants in NWE were looking to divert some of their tank space normally reserved for HSFO towards LSFO instead, to take advantage of the steep LSFO contango, sources said. The LSFO cargo market saw a balancemonth /front-month contango of $6.75/mt recently, making storage a more economical option than prompt sale. Reports of traders considering making the switch comes also as there was increasingly a dearth of storage space for LSFO given that healthy volumes were already held in the ARA and Scandinavian tanks.
380cst: $463
(1.0%): $482
180cst: $478
(1.0%): $499
DMB: N/A
MGO 0.1%S: $731
