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The oil markets are nervously trading up after several attacks in the North of Nigeria at the weekend, killing at least 150 people, attacks on oil plants are expected. The fear of supply shortages as well as renewed tensions in the Middle-East regarding Iran's nuclear program thus provided the oil market with some buying impetus this morning. As technical resistances have been breached, oil futures have extended their gains. ICE Brent has reached a new 2 month high. Currently oil futures are pulling back from their highs, with the temporarily recovering dollar limiting gains.

Yesterday, after a phase of consolidation oil prices lost ground at midday, weighed down by a strong dollar and the weak performance of European equities. When the dollar pared its gains and equities recovered from their intraday lows oil started to rise after the opening of NYMEX session, as analysts had expected. A string of technical buying orders were triggered when the WTI crude breached the important psychological 95.00 dollar resistance, lending even more support until late in the evening when ICE and NYMEX futures hit fresh three-month highs.

ICE Gasoil contract for November delivery settled at 984.50 dollars on Monday. This was 15.00 dollars above Friday's settlement. With some 36,700 contracts the traded volume was well below average.

The stochastic oscillator is still slightly bullish at all charts this morning, yet at the overbought level. When the WTI crude breached its 95.00 dollar resistance and hit a three-month high of 96.11 dollars, the contract is likely to trade with risks skewed to the upside today. The short-term uptrends stay strong, offering room for some profit taking. Should the two lines of the oscillator cross a selling signal would be triggered and the overbought markets would encourage a downward correction. Still, technical analysts take up a more bullish position for today. The WTI crude is supported at 93.50 dollars today, its first resistance is seen at 96.10 dollars. The Brent's first resistance is seen at 115.20 dollars, its first support is at 113.00 dollars.

U.S.

Nymex Access gaining: Oil prices trade higher in Asian trading hours and on Globex electronic trading platform this morning, even though Asian equities took a beat despite positive signals from Wall Street. The forecasts of shrinking supplies in the U.S.support prices and counter concerns over the European debt crisis. The traded volume is below average.

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

Crude oil +0.7; distillates -1.9; gasoline -0.4 million barrels vs previous week

Houston (ex-wharf indications 7-11)

380cst $663
180cst $713
MGO $997

Very tight avails for 180 cst

New Orleans (ex-wharf indications 7-11)

380cst $666
180cst $717
MGO $1002

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

Crude is jumping up again with WTI +$2.00. Singapore paper is fully adopting the bullishness, gaining with +$22.00 for 180cst and +$21.70 for 380cst for Nov, and for Dec 180 cst +$22.70 and 380cst +$22.70 with MGO Nov contracts at +$4.10 and for Dec at +$4.00. The cargo market is more cautious, gaining with 180cst +$12.00, 380cst +$9.89 and MGO +$3.38.

The Singapore market reopens today after a long weekend break. Prices of both 180 and 380cst products will be well above $700/mt mark resembling more GO than fuel. Bunker fuel swaps gained in line with crude futures. Front month papers added almost $13/mt to the price both in Rotterdamand Singapore. Calendar 2012 papers were almost as strong gaining approx. $11/mt. Despite very high spot prices the current backwardated structure of the forward curve remains favourable to buyers offering a discount of more than $45/mt from spot to the calendar 2012 year, $35 between 2012 and 2013, and $30 between 2013 and 2014. Both markets are trading strongly up this morning.

High premiums for prompt deliveries.

380 cst $711
180 cst $723
MDO $998

ARA (Amsterdam - Rotterdam - Antwerp)

Demand in some Northwest European bunker hubs started the week with thin trading activity, despite more upbeat sentiment in the oil markets. Rotterdam and Antwerp remain very tight and experience ongoing HSFO shortages. Tight HSFO supplies on a recent VLCC loading for Singapore continued to trigger operational delays at loading installations in Rotterdam. In the MOC 1% 681.25 were the levels traded, with hs 657-661 levels traded.

Rotterdam

Indications for delivered bunkers:

380cst : $ 675
(1.0 %) :$ 699
180cst: $ 693
(1.0 %):$ 716
MGO 0.1%S: $ 1005