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

Oil prices rose this morning, reversing early losses after the dollar weakened against the euro and fears eased over further monetary tightening in China.

Yesterday, oil prices traded in a narrow range in electronic trading and during NYMEX session, as expected. Though support lines were breached during the day, the lack of extensive profit taking had prices stay rangebound. The late drop was led by the gasoline contract that collapsed on signs fuel demand dropped sharply in the U.S. as retail prices have climbed to almost 4.00 dollars a gallon, 36% above a year ago and the highest level since August 1st, 2008. SpendingPulse, a macroeconomic indicator that reports on national retail sales, and is based on aggregate sales activity in the MasterCard payments network, reported that weekly gasoline demand in the U.S. dropped 1% to the lowest level since April 8 and 0.6% on year, the eighth drop in the past nine weeks. Four-week demand is down 1.2% from a year ago, the lowest demand since March 25.

ICE Gasoil contract for May delivery settled at 1,019.00 dollars Tuesday night. This was 20.75 dollars below Monday's settlement. Volume with some 43,000 deals slightly below average.

The Stochastic indicator at the brent, the WTI and the gasoil chart is clearly bearish this morning but no more overbought, while the RSI has returned to neutral territory between the 70.00 and 30.00 line on all charts. Upward trendchannels are still intact, but there is still room for a downward correction. Technical analysts expect prices to stay rangebound ahead of the release of the DOE data later today. The first support for the WTI crude is seen at 110.20 dollars, the first resistance at 111.65 dollars. The Brent's first resistance is seen at 123.45 dollars, its first support is at 121.70 dollars.

U.S.

Nymex Access gaining. Oil futures recovered in East Asia and Globex electronic trading this morning, paring some of last night's losses on the decline of the U.S. dollar. The traded volume is little above average. average.

APIs: crude oil +3.2; distillates -1.5; gasoline +0.7 million barrels vs previous week. Refinery utilization +0.6%

DOEs: due out tonight

Forecasts: crude oil +1.9; distillates +0.8; gasoline +0.3 million barrels vs previous week. Refinery utilization +0.2%

Houston (ex-wharf indications 3-5)

380 cst $676
180 cst $710
MDO $1054

Very tight avails for 180 cst

New Orleans (ex wharf indications 3-5)

380 cst $679
180 cst $714
MDO $1058

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

Crude is turning bearish again, losing with WTI -$2.08 Singapore paper is not yet reacting with +$3.40 for 180 cst and +$2.95 for 380 cst for May, and for Jun 180 cst +$1.40 and 380cst +$1.10 with MGO May contracts at -$1.55 and for Jun at -$1.52 The cargo market is mixed, looking for direction with 180cst +$1.10, 380cst +$1.11 and MGO -$0.26.

The Singapore fuel oil markets were up around $1.00 yesterday during the Platts window despite weaker crude. The Asian fuel oil swaps strengthened as buying interest were firm. The Singapore heavy residual inventory reported another slight build of +0.15 mbbl to 23.19 mbbl; one of the highest in 6 months. The bunker delivered premiums remained app. $5.00 above cargo prices yesterday. This morning both markets are trading slightly lower.

High premiums for prompt deliveries.

380 cst $680
180 cst $692
MDO $1038

Fujairah (delivered indications 4-5)

380cst: $676
180cst: $707
MGO: $1050

Rotterdam

Yesterday in the MOC lsfo was traded between 691.50-693 usd, hsfo between 647-651 usd.

Indications for delivered bunkers:

380cst: $649
(1.0%): $698
180cst: $671
(1.0%): $714 (very low avails)
MGO 0.1%S: $1018