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Technical indicators: neutral to bullish

Oil prices consolidated in morning trading as investors are cautious ahead of the release of US economy data and US petroleum inventories.

After the oil prices suffered from heavy losses on Monday they recovered with a renewed trust as just before 20:00 the U.S. central bank announced further cut in interest rates by 0.75 percent to 2.25 percent. Although the markets had expected strong buying momentum NYMEX crude oil tested in a psychological resistance the area of 110.00 dollars. The upward chart technical trend remained intact and follows the recommendations of leading brokers this morning. The continued weak dollar in relation to the United States financial crisis - despite mild recovery on Tuesday - are up to date and remain the strongest factor in the oil markets. The OPEC decision last week, the Oil production not to change, leaves the market rather bullish. The production losses from Nigeria also support this. Also the dispute between Iran and the West still has a bullish effect on NYMEX and ICE.

Oil prices eased in electronic morning trading Monday, as was expected, but found support later in the day by the ailing dollar, positive US economy data and ongoing riots in Egypt. When the brent breached the important psychological 100.00 dollar resistance line, the rally extended into after-hour trading and ICE and NYMEX prices hit their highest in two years.

ICE Gasoil contract for February delivery settled at 835.50 dollars Monday night. This was 11.25 dollars above Friday's settlement. Volume with some 47,900 deals slightly below average.

All contracts left their trendchannels Monday after having breached several resistance lines. Technical analysts expect market participants to take some profit today after the gains of the past couple of days, but the overall sentiment is still rather bullish. Yet the WTI crude's gains should be limited to a high of 92.85 dollars (first resistance). Should this mark be breached, more technical buying orders are expected, while technical selling will only occur should the brent fall below 100.00 dollars for a barrel (first support). The Stochastic indicator gives a bullish signal for all contracts while the RSI is in neutral territory. The first support for the WTI crude is seen at 91,50 dollars. The first resistance for the brent is seen at 101.00 dollars.

U.S.

Nymex Access losing: Oil futures are flat on a high level in Asian trading hours and electronic Globex trade this morning, Egypt's social upheaval keeping the Brent firmly above 100.00 dollars for a barrel. The WTI crude is trading above 92.00 dollars, thus narrowing the spread between the two crudes to some 8.00 dollars for the barrel. The traded volume is on average.

Survey of US petroleum inventories due out today is as follows: crude oil +2.600; distillates -1.400, gasoline +2.200 million barrels vs previous week. Refinery utilization -0.4%.

Houston (ex-wharf indications 31/1)

380 cst $537
180 cst $572
MDO $858

Very tight avails for 180 cst

New Orleans (ex wharf indications 31/1)

380 cst $539
180 cst $574
MDO $861

Singapore (correct as of 1430hrs LT - delivered indications)

Crude is surging still with WTI +$2.04 Singapore paper is reflecting it with +$11.90 for 180 cst and +$10.80 for 380 cst for Feb, and for March 180 cst +$10.95 and 380cst +$11.00 with MGO Feb contracts at +$1.10 and for May at +$1.08 The cargo market is starting to adopt the bullishness with 180cst +$8.25, 380cst +$7.83 and MGO +$1.17

High premiums for prompt deliveries.

380 cst $576
180 cst $584
MDO $844

Fujairah (delivered indications 1-2)

380cst: $582
180cst: $612
MGO: $910

Rotterdam

Indications for delivered bunkers:

380cst: $533
(1.0%): $543
180cst: $548
(1.0%): $561 (very low avails)
MGO 0.1%S: $845