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European equity markets opened considerably lower today after dropping for two consecutive sessions as markets are still worried about a Greek default. European leaders were once again incapable of taking appropriate measures, despite the urgency of the matter and so investors' risk aversion declined.

After the Stochastic indicator's two lines crossed at NYMEX and ICE charts Friday, oil markets got a selling signal that affected prices still Monday morning. A weaker euro and equity market's losses also weighed on prices in a very volatile market. Negative sentiment prevailed after Greek declared at the weekend that its government debt will rise more than stipulated this year. Not even positive indicators from the USAand the euro zone could stabilize prices, although a better-than-expected ISM manufacturing index helped oil futures to a short-lived boost during the session in New York. When market participants took profit in late trading, WTI crude fell as low as 75.92 dollars, a year low.

ICE Gasoil contract for October delivery settled at 874.50 dollars on Monday. This was 9.00 dollars below Friday's settlement. With some 51,600 contracts the traded volume was about on average.

OPEC Even though the cartel's oil production was little changed in September compared to the previous month, it hits a year high after Libyaresumed oil production and exports. OPEC's production level in September was 30,525 mln bpd (incl. Iraq), up 7,000 bpd on month. The cartel's members regard supply and demand in crude markets currently as balanced and oil reserves as sufficient. But demand is slowing due to declining oil imports from Chinaand India, slow economic growth in the US and the European debt crisis. Yet OPEC sees no need for a change in output at their next scheduled meeting. But a Saudi official said the cartel was ready to take the necessary steps to stabilize oil prices if needed.

The Stochastic indicator's selling signals are a few days old but the oscillator is still seen bearish today. Market participants might cover some short positions today after Monday's losses and thus trigger a small short-term upward correction. Yet analysts maintain a bearish trading bias in anticipation of fresh lows. The WTI crude is supported at 75.00 dollars today, its first resistance is seen at 79.65 dollars. The Brent's first resistance is seen at 102.80 dollars, its first support is at 100.00 dollars.

U.S.

Nymex Access losing. Oil futures trade higher in East Asiaand Globex electronic trade this morning as market participants cover some of their short positions after yesterday's price decline. The traded volume is above average.

Survey of US Petroleum inventories due out tonight at 22:30 (API) and Wednesday at 16:30 (DOE)

Crude oil +1.0; distillates -0.3; gasoline+1.1 million barrels vs previous week

Houston (ex-wharf indications 3-10)

380cst $611
180cst $657
MGO $904

Very tight avails for 180 cst

New Orleans (ex-wharf indications 3-10)

380cst $613
180cst $659
MGO $906

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

Crude is dropping still with WTI -$1.73 Singapore paper is mirroring crude, losing with -$7.25 for 180cst and -$7.00 for 380cst for Oct, and for Nov 180 cst -$8.45 and 380cst -$8.55 with MGO Oct contracts at -$1.43 and for Nov at -$1.43. The cargo market is also losing still with 180cst -$13.11, 380cst -$7.78 and MGO -$1.90.

The Singapore bunkerdifferential gained $4.50 to a premium of $16.25, with bunker prices at $638.00-$640.00, down $5.00. Bunker fuel swaps lost a couple of dollars at the front of the curve both in Rotterdamand Singapore. Losses in the back end were even higher, reaching $6.00/mt. This morning markets are trading lower.

High premiums for prompt deliveries.

380 cst $628
180 cst $638
MDO $875

Fujairah (delivered indications 4-10)

380cst $630
180cst $640
MGO $1030

Avails issue are sustaining the market.

ARA (Amsterdam - Rotterdam - Antwerp)

The Northwest European bunker experienced low levels of liquidity Monday as crude prices were down in European trading amid renewed fears about the European economy. Suppliers in ARA reported fewer inquiries as most market participants remained bearish on lower oil prices. Prices levels in Rotterdam remained firm despite a $1/mt drop in FOB Rotterdam barges as the port continued to report very tight high sulfur fuel oil supplies. Ongoing HSFO and low sulfur fuel oil shortages continued to cause congestion at loading installations. In the MOC 1% was traded between $ 610-617 with hs $ 595-602 levels traded.

Rotterdam

Indications for delivered bunkers:

380cst : $ 594
(1.0 %) :$ 612
180cst: $ 615
(1.0 %):$ 636
MGO 0.1%S: $ 871