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Technical indicators: neutral

A weaker dollar and a positive US housing market index, along with the ongoing strike in France supported oil prices also in late NYMEX session and after-hours trading. Despite Monday's rally, oil prices are still in a lateral trend channel. When the WTI crude 80.00 dollar support could not be breached, prices rebounded on technical buying. Both RSI and Stochastic indicators give neutral signals this morning. First WTI crude support line seen at 80.00 dollars today, first resistance line at 83.20 dollars. The 80.00 dollar support is still seen as a key support level below which massive technical selling is expected.

Oil prices are expected to retrace part of the previous session's gains in the morning, in the face of a stronger dollar and forecasts for rising US crude inventories. The unexpected decline of industrial production in the U.S. will also keep weighing on prices. In the afternoon, figures from the USA to the housing market situation may reverse the picture.

ICE Gasoil October is expected to open 0,25 to 1,75 dollars lower at about 714,25 dollars/ton after settling at 715,25 dollars (official settlement price) Monday night. This was 3,50 dollars above Friday's settlement. Volume with some 55,600 deals above average.

USA:

The NAHB/WF Housing Market Index rose to 16.00 in October, after a reading of 13.00 in September.

Industrial production last month declined by 0,2%, when econmists expected a rise of 0,2%.

Capacity utilization remained unchanged at 74,70% in September, after 74,80% in August.

Nymex Access : Oil futures are easing in Asian trading hours and NYMEX electronic trading this morning, pressured by the rising dollar and profit taking. No news in the markets. The traded volume is above average.

Survey of US Petroleum inventories : API data will be released Tuesday at 22:30, DOE data Wednesday at 16:30.

crude oil +2.4; distillates -0.9; gasoline -1.3 million barrels vs previous week. Refinery utilization: unchanged;

Houston (ex-wharf indications 18-10)

380cst: $467
180cst: $487
MGO: $742

Very tight avails for 180cst

New Orleans (ex-wharf indications 18-10)

380cst: $469
180cst: $489
MGO: $746

Singapore (correct as of 1430hrs local time)

Crude is surging with WTI +$2.35. Singapore paper is reacting sharply with 180cst +$10.60 and 380cst +$10.30 for Oct, and Nov 180 cst +$10.70 and 380cst +$10.30 with MGO Oct contracts +$1.96 and for Nov at +$1.96. The cargo market is still reacting to the drop over the weekend but this will be shortlived with 180cst -$9.45, 380cst -$10.37 and MGO -$2.78.

The Singapore fuel oil market opened the week, dropping more than -$9.5/mt tracking the crude loss previously during the Platts window. The delivered bunker premiums went up more than $2.0 above cargo prices yesterday as lower outright prices attract bunker demand.

High premiums for prompt deliveries:

380cst: $469
180cst: $477
MGO: $710

All prices subject to enquiry.

Fujairah (delivered indications 18/10)

380cst: $462
180cst: $477
MGO: $727

Rotterdam

Yesterday (Only barge trade deals of >2 KT reported) 36KT was traded in the MOC between 453,50-454,50 with Litasco as the main seller to Gunvor as the main buyer.

The NWE barge market fundamentals remained unchanged since the close of last week, however a Singapore-bound VLCC was heard placed on subjects. Arbitrage opportunities to Southeast Asia was seen closed for November, and marginal for December, according to Platts data.The low sulfur fuel oil market continued to see healthy availability in Northwest Europe, however hi-los saw some support from traders electing to hold product in tank rather than selling into a front heavy contango market. A 70,000mt ex-United States cargo imported by Shell arrived into Rotterdam last week, while the company is scheduled to bring in another cargo this month. Petrobras is also importing a 40,000mt cargo into ARA before the month-end further augmenting regional stocks. Petrobras confirmed the import, while Shell declined to comment. Platts Market on Close assessment process saw a bid for utility specification LSFO cargo by Mercuria being hit by Shell at Platts NWE 1% cargo quotations minus pricing over October 18-29.

380cst: $461
(1.0%): $482
180cst: $476
(1.0%): $499
DMB: N/A
MGO 0.1%S: $725