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Technical indicators: bullish

Oil prices advance as the dollar falls and European stocks rise. Resistance lines were breached across the complex. More direction to be expected from the US inventory data later today.

After Yesterday's price collapse, oil futures continued to loose ground in late morning trading after support lines were breached on a strong dollar. Technical selling orders were triggered and depressed the oil complex to intraday lows. After the opening of NYMEX session, the dollar reversed its gains, tempting traders to go long on commodities. Wall Street's late gains also lent some support and resistance lines were breached in the process.

ICE Gasoil contract for May delivery settled at 1,000.25 dollars Tuesday night. This was 4.50 dollars below Monday's settlement. Volume with some 65,800 deals above average.

The short-term technical triangle at the brent chart was breached in downward direction yesterday, when the strong dollar and economic worries overrode the technical constellation. The Stochastic indicator on the gasoil and brent chart is still neutral while the one on the WTI crude is seen slightly bullish. ICE brent is trading just below a short-term resistance this morning. Should this be breached, technical buying orders will support the oil complex. Yet technical analysts regard the WTI's resistance at 110.50 dollars as the end of the line. The RSI is still in neutral territory on all charts. The first support for the WTI crude is seen at 106.00 dollars, the first resistance at 109.20 dollars. The Brent's first resistance is seen at 122.30 dollars, its first support is at 120.00 dollars.

U.S.

Nymex Access gaining. Oil futures are trading higher in East Asia and Globex electronic trading this morning, the brent holding above 122.00 dollars for a barrel, lifted by a larger-than-expected draw on US oil product stocks as per API and the ailing dollar. The traded volume is on average.

APIs: crude oil +0.7; distillates -3.4; gasoline -1.8 million barrels vs previous week. Refinery utilization +2.4%

DOEs: due out tonight

Forecasts: crude oil +0.7; distillates -1.2; gasoline -0.2 million barrels vs previous week. Refinery utilization +1.1%

Houston (ex-wharf indications 19-4)

380 cst $646
180 cst $681
MDO $1022

Very tight avails for 180 cst

New Orleans (ex wharf indications 19-4)

380 cst $648
180 cst $683
MDO $1025

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

Crude is countering yesterday's drop, gaining with WTI +$2.71 Singapore paper is turning as well with +$5.95 for 180 cst and +$6.75 for 380 cst for May, and for Jun 180 cst +$7.00 and 380cst +$7.15 with MGO May contracts at +$1.18 and for Jun at +$ 1.20 The cargo market is reacting to Yesterday's losses with 180cst -$15.34, 380cst -$13.34 and MGO -$2.03.

The Singapore fuel oil markets were down by more than $13.0/mt yesterday. There was heavy selling interest in the fuel oil swaps, which continue to depress the fuel oil value. The bunker delivered premiums were higher around $7.5/mt above cargo prices. Front month bunker fuel swaps were assessed down by almost $6/mt in Rotterdam and even more in Singapore. Backend prices were stronger loosing only half as much. This resulted in a flattening of the forward curve again. The backwardation of the forward curve has partly gone for fuel paper prices while GO prices has already flipped back to contango. Market is trading up this morning pricing in an overnight gain of crude futures.

High premiums for prompt deliveries.

380 cst $669
180 cst $684
MDO $1035

Fujairah (delivered indications 20-4)

380cst: $673
180cst: $697
MGO: $1030

Rotterdam

Yesterday, in the MOC lsfo was traded at usd 704, hsfo between usd 633 and usd 645.50.

Indications for delivered bunkers:

380cst: $643
(1.0%): $712
180cst: $664
(1.0%): $737 (very low avails)
MGO 0.1%S: $1027