---

Technical indicators: bearish immediate term / neutral medium term

Oil prices fell this morning on weak US Stocks and a strengthening dollar, also weak economic data from China outweighed fragile support from market expectation the sovereign debt crisis on both sides of the Atlantic could somehow be contained.

As was to be expected, oil prices initially traded steadily on Wednesday morning, reaching their intra-day highs in the early afternoon. Slightly bullish technical analysis as well as the retreating dollar, supported this tendency. Ahead of the publishing of the DOE's data, there has been some profit taking, as investors liquidated their positions. Although the data had no immediate impact on prices, they increased volatility throughout the complex, which showed in the course of the evening. Oil futures at ICE and NYMEX then significantly retreated, reaching new intra-day lows. Analysts assume that this sudden retreat of prices had been caused by profit taking, as investors liquidated long positions of the expiring WTI Crude oil contract for August delivery. During late trade this downward reaction was corrected again and oil futures settled slightly higher .

ICE Gasoil contract for August settled at 977.75 dollars on Wednesday. This was 1.50 dollars above Tuesday's settlement. With some 50,600 contracts, the traded volume was below average.

The stochastic indicator for ICE Gasoil, Brent and WTI Crude oil is slightly bullish again this morning. Chart analysts forecast the medium-term range for NYMEX Crude Oil still at 94 to 100 dollars, respectively at 113.40 to 119.50 dollars for Brent. Given the slightly bullish technical analysis, a test of resistances was very likely, a sustained rise, however, would require further impetus by fundamentals, as market participants started consolidating larger positions ahead of the weekend, analysts say. The first support for the WTI crude is seen at 97.50 dollars, its first resistance at 99.35 dollars. The Brent's first resistance is seen at 118.85 dollars, its first support is at 117.00 dollars.

U.S.

Nymex Acces losing. Oil prices edged lower during electronic morning trade. The lower Chinese PMI is supposed to have given some impetus causing profit taking. The volume traded at NYMEX is clearly below average. Market participants wait for the opening of the European markets, for further momentum from foreign exchange and for US economic data to be published in the afternoon.

APIs: crude oil -5.2; distillates +1.1; gasoline +2.0 million barrels vs previous week. Refinery utilization +2.0%

DOEs: crude oil -3.7; distillates +3.4; gasoline +0.8 million barrels vs previous week. Refinery utilization +2.3%

Forecasts: Crude oil -1.2; distillates +0.8; gasoline +/- 0.0 million barrels vs previous week.

Houston (ex-wharf indications 20-7)

380 cst $648
180 cst $679
MDO $1004

Very tight avails for 180 cst

New Orleans (ex wharf indications 20-7)

380 cst $651
180 cst $682
MDO $1008

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

Crude is back on its bearish track, losing with WTI -$1.06. Singapore paper is mirroring crude again, losing with -$3.75 for 180cst and -$4.30 for 380cst for Aug, and for Sep 180 cst -$3.70 and 380cst -$4.35 with MGO Aug contracts at -$0.76 and for Sep at -$0.78. The cargo market is ignoring crude and paper, gaining bullish momentum with 180cst +$4.05, 380cst +$5.32 and MGO +$1.33.

The Singapore fuel oil markets rose by more than +$4.0/mt during the Platts window. Asian fuel oil crack widen yesterday while fundamentals remain firm overall. Bunker demand yesterday was pretty slow due to the higher outright prices. The delivered premiums were estimated at $7.0/mt above cargo prices. Bunker swaps gained $3 – 3.5/mt lifting the entire curve up. Front month prices were slightly stronger compared to the 2012 papers.

High premiums for prompt deliveries.

380 cst $672
180 cst $681
MDO $977

Fujairah (delivered indications 21-7)

380 cst $673
180 cst $711
MDO $1071

Rotterdam

Yesterday in the MOC hsfo was traded between 653-656 usd and lsfo between 697-700 usd.

Indications for delivered bunkers:

380cst : $ 653
(1.0 %) :$ 703
180cst: $ 685
(1.0 %):$ 737
MGO 0.1%S: $ 977