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Technical indicators: neutral to bearish

Oil futures dropped slightly during morning trade on expectations regarding the OPEC meeting and DOE data to be published in the afternoon. NYMEX C.Oil breached the first resistance line.

Oil futures lost ground in electronic morning trading yesterday but the weaker dollar prevented further losses at this time and an upward correction was initiated after support lines could not be breached. Technical buying orders, triggered when first resistance lines were breached, buoyed the oil complex and futures settled at new highs.

OPEC: On their next meeting, later this week in Vienna, the cartel is expected to close the gap between current quotas and official production, which stands at about 1.4 million barrels per day. On the other hand, a higher increase in quotas will be hard to push through. Saudi Arabia, the strongest OPEC member, as well as other Gulf countries, would like to see prices lower.

ICE Gasoil contract for June delivery settled at 950.00 dollars Monday night. This was 0.75 dollars below Friday's settlement. Volume with some 46,400 deals below average.

The stochastic indicator at the Gasoil, Brent and WTI charts remains bearish also for today while the RSI is still in neutral territory. The WTI crude breached its medium-term uptrend and a short-term downtrend has formed. For today, technical analysts see key fundamentals overruling the technical constellation. The first support for the WTI crude is seen at 98.45 dollars, the first resistance at 100.25 dollars. Brent's first resistance is seen at 117.40 dollars, its first support is at 113.75 dollars.

U.S.

Nymex Access losing. Oil prices edge lower in East Asia and Globex electronic trading this morning on profit taking ahead of the OPEC meeting and a stronger dollar. The traded volume is slightly above average.

APIs: crude oil -5.5; distillates +1.8; gasoline -0.4 million barrels vs previous week. Refinery utilization +0.7%

DOEs: due out tonight.

Forecasts: Crude oil -0.9; distillates +0.4; gasoline +0.4 million barrels vs previous week.

Houston (ex-wharf indications 7-6)

380 cst $662
180 cst $692
MDO $983

Very tight avails for 180 cst

New Orleans (ex wharf indications 7-6)

380 cst $664
< 180 cst $695
MDO $986

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

Crude is bearish still with -$1.05 Singapore paper more bullish, gaining with +$4.75 for 180 cst and +$4.50 for 380 cst for Jun, and for Jul 180 cst +$4.75 and 380cst +$4.85 with MGO Jun contracts at +$1.00 and for Jul at +$0.99 The cargo market is slowing, gaining with 180cst +$1.23 380cst +$0.14 and MGO +$0.51.

The Singapore fuel oil market was down $1.50 -2.00 during the Platts window yesterday tracking softer crude. Market fundamentals continue to look firm as supporting the buying interest and also widening the backwardation curve. The delivered premiums strengthened to around $12.50 above cargo prices yesterday. Both markets are trading slightly higher this morning.

High premiums for prompt deliveries.

380 cst $670
180 cst $681
MDO $970

Fujairah (delivered indications 8-6)

380cst: $660
180cst: $688
MGO: $1025

Rotterdam

Yesterday in the MOC hsfo was traded between 628.50-631.25 usd and lsfo between 669-671 usd.

Indications for delivered bunkers:

380cst: $637
(1.0%): $677
180cst: $663
(1.0%): $704 (very low avails)
MGO 0.1%S: $966