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Technical indicators: neutral

Oil futures have tested some downward potential during morning trade, paring yesterday evening's gains, as investors look ahead to important European and US economic data to be published later today. This correction down is supported by a weaker dollar. Currently oil prices are pulling back from their last intraday low, moving within their tight trend channels. More direction is expected from the US economic data, to be released later today.

After a quiet early morning trade and a bit of selling off around midday, oil surged during the session in New York, supported by a weaker dollar that was affected by data showing manufacturing in the New York area contracted for the third straight month in August, tempering any lingering hopes for a rebound in the second half of the year. WTI crude prices even made a charge above 88.00 dollars a barrel for the first time in seven days. Eventually, oil futures prices settled higher, guided by weakness in the dollar and a strong performance of U.S. equities.

ICE gasoil for August delivery settled at 922.75 dollars on Monday. This was 5.75 dollars above Friday's settlement. With some 65,040 contracts the traded volume was slightly above average.

The RSI indicator had crossed the 30% line at all charts Monday, giving markets a strong buying signal. The Stochastic indicator stays slightly bullish but has meanwhile entered overbought territory, paving the way for a technical upward correction. But the uptrend being regarded as strong, technical analysts see oil prices ranging within the boundaries of their uptrend channels also today. The first support for the WTI crude is seen at 85.40 dollars, its first resistance at 88.05 dollars. The Brent's first resistance is seen at 110.00 dollars, its first support is at 107.50 dollars.

U.S.

Nymex Access gaining: Oil futures are poised on a high level in Asian trading and Globex electronic trading this morning, holding on to Monday's gains ahead of a string of important EU and US indicators that might give direction later today. The traded volume is slightly below average.

Houston (ex-wharf indications 9-8)

380 cst $624
180 cst $656
MDO $924

New Orleans (ex wharf indications 9-8)

380 cst $627
180 cst $658
MDO $928

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

Crude is gaining still with WTI +$1.00. Singapore paper is bullish still as well, gaining with +$6.25 for 180cst and +$8.00 for 380cst for Aug, and for Sep 180 cst +$6.25 and +$7.95 for 180cst with MGO Aug contracts at +$0.19 and for Sep at +$0.21. The cargo market is in line with the bullish sentiment, gaining with 180cst +$3.38, 380cst +$4.05 and MGO +$0.74.

The Singapore bunker spread between ex-wharf marine fuel prices and fuel oil cargo values, remained wide at a premium of $10.88, inching up 38 cents from the previous session, with bunker fuel prices higher at $645.00/mt, up $5.00. A third consecutive month of below average import volumes, both from the West and from Iran , allied with steady demand means that the market is tight, and likely to remain so at least into September. Reflecting this, inventory levels in Singapore remained below average at 19.6 million barrels, the sixth week running they have been less than 20 million barrels. This morning both markets are trading higher.

High premiums for prompt deliveries.

380 cst $649
180 cst $658
MDO $907

Fujairah (delivered indications 16-8)

380 cst $672
180 cst $702
MDO $1069

Rotterdam

Indications for delivered bunkers:

380cst : $ 621
(1.0 %) :$ 648
180cst: $ 647
(1.0 %):$ 674
MGO 0.1%S: $ 921