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Technical indicators: bearish immediate term / neutral to bullish medium term

Oil prices traded lower this morning, reaching their lowest levels since the outbreak of the political tension in Egypt last week. Traders anticipate bearish US stockreports later today and tomorrow.

Oil fell to the lowest level in a week as talks between the government and opposition leaders helped ease tensions in Egypt, reducing concern that supplies will be disrupted. Several support lines were breached. Egypt’s government pledged progress within a month toward free elections, a move intended to persuade protesters to leave Cairo’s Tahrir Square after two weeks of rallies aimed at toppling President Mubarak.

ICE Gasoil contract for February delivery settled at 845.00 dollars Monday night. This was 1.75 dollars above Friday's settlement. Volume with some 44,900 deals below average.

The Stochastic of Brent and WTI remain both bearish on today, and started to give a selling signal to the market. The Stochastic indicator is still in overbought territory for all contracts while the RSI remains in the neutral area. As most of the risk premium has already been priced in Egypt, prices are expected to decline further. The first support for the WTI crude is still seen at 87.15 dollars, the first resistance at 89.55 dollars. The brent's first support is at 98.75 dollars and the first resistance at 100.00 dollars.

U.S.

Nymex Acces gaining: Oil futures are edging higher in Asian trading hours and electronic Globex trade this morning, after yesterday's hefty losses. The traded volume is at average.

Houston (ex-wharf indications 7/2)

380 cst $541
180 cst $574
MDO $868

Very tight avails for 180 cst

New Orleans (ex wharf indications 7/2)

380 cst $543
180 cst $576
MDO $871

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

Crude is losing still with WTI -$1.07 Singapore paper is ignoring it, bouncing up with +$3.70 for 180 cst and +$3.75 for 380 cst for Feb, and for March 180 cst +$3.25 and 380cst +$2.25 with MGO Feb contracts at +$0.29 and for Mar at +$0.31 The cargo market is slowly adopting the bearishness with 180cst -$1.64, 380cst -$3.91 and MGO -$0.67

The Singapore fuel oil markets reopened this week after a long break for the Chinese New Year holidays. Prices were down only -$4.0 to -$1.5 during the Platts window. The fuel oil cargo premiums were at a record of around $9.00 to $10.00 reflecting the tight supply of bunker grade products. The delivered bunker premium ranged $16.0 to $22.0 above cargo prices yesterday. Bunker fuel swaps gained a few dollars along the curve both in Rotterdam and Singapore being slightly stronger at the front. The spread between 180cst and 380cst papers in Singapore has broadened to more than $15 at the front of the curve. Both markets are currently traded higher.

High premiums for prompt deliveries.

380 cst $594
180 cst $606
MDO $854

Fujairah (delivered indications 8-2)

380cst: $613
180cst: $647
MGO: $925

Rotterdam

Indications for delivered bunkers:

380cst: $540
(1.0%): $551
180cst: $565
(1.0%): $578 (very low avails)
MGO 0.1%S: $851