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

After having briefly consolidated in Asian trade, oil prices have fallen in the morning and have breached first supports. This downward development had been caused primarily by losses during the Asian session and by the European stock exchanges' weak performance. The dollar regaining some strength has additionally curbed prices. As investors wait for several important US economic indicators to be published in the afternoon, which might give further cues regarding the current state of the US economy, losses have been limited so far, however. Ahead of these data no significant price fluctuations are expected. Should these figures turn out mainly disappointing, however, worries about economic growth will also weigh on oil prices.

Yesterday, oil futures started higher in the morning, breaching resistance lines in European trading hours. The easing dollar and the bullish effect of the previous day's API data lent support. Only short off the 944.50 dollar resistance for the gasoil and 111.85 dollar resistance for the Brent did the uptrend loose momentum. Investors had bet on DOE data coming out bullish as well, building up speculative long positions in the forefront. When the data did not have the expected effect, investors sold off and oil prices retreated from intraday high's.

ICE gasoil for September delivery settled at 936.50 dollars on Wednesday. This was 9.00 dollars above Tuesday's settlement. With some 72,900 contracts the traded volume was well above average.

The RSI, being in a neutral area at NYMEX as well as at the ICE, has lost its influence. The stochastic indicator crosses it in the overbought area and is therefore to be seen as bearish. Yet chart analysts regard the situation as neutral as the uptrend channel is still intact. Without any new bearish impetus, as might be given by foreign exchange, for example, oil futures will probably continue to consolidate within the channel. Should their support areas be tested and exceeded, however, in the course of the day, analysts expect a strong selling impetus and a clear correction downward. The first support for the WTI Crude is seen at 86.65 dollars, its first resistance at 89.00 dollars. The Brent's first resistance is seen at 111.75 dollars, its first support is at 110.00 dollars.

U.S.

Nymex Access gaining: Oil futures are trading lower in East Asia and Globex electronic trading this morning, the brent staying below 111.00 dollars for a barrel as ongoing concerns over Europe's debt crisis and a firmer dollar drew investors away from oil. The traded volume is below average.

APIs: crude oil +1.7; distillates -1.3; gasoline -5.4 million barrels vs previous week. Refinery utilization +0.5%

DOE's: crude oil +4.2; distillates +2.4; gasoline -3.5 million barrels vs previous week. Refinery utilization -0.9%

Forecasts: crude oil +0.4; distillates +0.7; gasoline -1.3 million barrels vs previous week.

Houston (ex-wharf indications 15-8)

380 cst $626
180 cst $662
MDO $938

New Orleans (ex wharf indications 15-8)

380 cst $628
180 cst $664
MDO $941

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

Crude is turning slightly after the recent bullish run, losing with WTI -$0.35. Singapore paper is reacting, but not turning yet with +$0.70 for 180cst and +$0.70 for 380cst for Sep, and for Oct 180 cst +$0.85 and +$0.80 for 180cst with MGO Sept contracts at -$0.29 and for Oct at -$0.30. The cargo market is gaining still with 180cst +$8.27, 380cst +$8.62 and MGO +$1.45.

The Singapore fuel oil markets were up more than $8.00 during the Platts window yesterday. Market has been strong on the buying side narrowing the Asian fuel oil crack spread. The delivered premiums were around $10.75 above cargo prices yesterday. This morning both markets are trading down.

High premiums for prompt deliveries.

380 cst $658
180 cst $665
MDO $919

Fujairah (delivered indications 18-8)

380 cst $671
180 cst $696
MDO $1072

Rotterdam

Indications for delivered bunkers:

380cst : $ 633
(1.0 %) :$ 663
180cst: $ 659
(1.0 %):$ 690
MGO 0.1%S: $ 937