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Technical indicators: neutral to bearish

The strong dollar again causing losses throughout the complex, according to market participants. Oil futures dropped near yesterday's lows. Additional bearish momentum is given by weak stocks.

Yesterday, oil futures were mainly orienting towards the foreign exchange market. Bearish technical analysis and the advancing dollar rendered possible some profit taking. Oil prices recovered in the cours of the day, after supports at 950 dollars for Gasoil and at 115 dollars for Brent proved strong and after some profit taking regarding the dollar. Particularly NYMEX Crude Oil rose significantly, as market participants liquidated their spread positions ahead of the US oil inventories data. Further momentum came from the FED's open-market meeting, during which some of its members pleaded for new measures supporting the US economy (Quantitative Easing 3), and from the API data published in the evening. While the FED's discussions have supported oil prices, the larger-than-expected builds of oil inventories have been seen as bearish triggering some selling orders later in the evening. This morning during early trade, better-than-expected chinese economic data slightly lifted prices however.

ICE Gasoil contract for July settled at 967.00 dollars on Tuesday. This was 6.25 dollars above Monday's settlement. With some 104,900 contracts, the traded volume was far above average.

The stochastic indicator remains slightly bearish this morning, even if the selling signal already dates some days back. As it shows first signs for a change of direction regarding the WTI, the point of view of the chart analysts is neutral this morning. In addition to this, oil prices' tendency is still up, leaving little opportunity for a downward development. Only if supports are breached, new selling impetus will be created. The first support for the WTI crude is seen at 93.55 dollars, its first resistance at 97.50 dollars. The Brent's first resistance is seen at 117.85 dollars, its first support is at 116.00 dollars.

U.S.

Nymex Acces gaining. Oil futures edge higher during electronic trading. The figures regarding China's economic growth lead to a steady tendency, whereas last night's bearish API data keep gains in their boundaries. The volume traded at NYMEX is slightly below average this morning. Investors wait for the opening of the European markets, for further impetus from foreign exchange and for the DOE's oil inventories data.

APIs: crude oil +2.3; distillates +4.8; gasoline -1.6 million barrels vs previous week. Refinery utilization -1.4%

DOEs: due out tonight.

Forecasts: Crude oil -1.7; distillates +0.2; gasoline +/- 0.0 million barrels vs previous week

Houston (ex-wharf indications 12-7)

380 cst $651
180 cst $682
MDO $998

Very tight avails for 180 cst

New Orleans (ex wharf indications 12-7)

380 cst $653
180 cst $684
MDO $1001

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

Crude is back on its bullish track, surging with WTI +$3.55. Singapore paper is mirroring it with +$11.70 for 180 cst and +$11.75 for 380 cst for Jul, and for Aug 180 cst +$11.75 and 380cst +$12.00 with MGO Jul contracts at +$1.94 and for Aug at +$2.00. The cargo market is slowing, but not yet turning with 180cst -$5.53, 380cst -$4.34 and MGO -$1.14.

The Singapore fuel oil market extended its loss by more than $4.00 during the Platts window yesterday on weaker crude prices. Market fundamentals have improved and the delivered premiums softened to around $8.00 above cargo prices yesterday. This morning both markets are trading higher.

High premiums for prompt deliveries.

380 cst $671
180 cst $682
MDO $972

Fujairah (delivered indications 13-7)

380cst: $672
180cst: $705
MGO: $1061

Rotterdam

Indications for delivered bunkers:

380cst :$ 650
(1.0 %) :$ 702
180cst :$ 672
(1.0 %) :$ 726
MGO 0.1%S: $ 979