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Morning trade has been rather lacklustre today, as market players have remained cautious ahead of US employment data and the DOE's oil inventories. Only around noon, when news about China's central bank planning to cut banks' reserve requirement ratio by 0.5 percentage points have spread, oil prices surged. ICE G.Oil has breached its first resistance line, whereas NYMEX C.Oil has risen above its second resistance and currently trades at more than 100.00 dollars. With this cut, the first in about 3 years, the Peoples' Bank of China wants to support the countries economy. Investors still also keep an eye on US employment data and the DOE's figures regarding oil inventories to be published in the afternoon.

Oil prices started higher yesterday as traders returned from the long US weekend with a positive stance. The recovering euro and a strong rise in European equities helped oil prices up in electronic morning trading and lent support throughout the day. Rekindling hopes of a solution of the European debt crisis and positive European and US indicators had lifted traders' spirit. A major supportive factor for oil, however, was the rising geopolitical risk after the Arab League had imposed sanctions on Syriaand the European Union on Thursday will decide on fresh sanctions on Iran. Part of the sanctions will probably be an embargo on Syrian and Iranian oil which could lead to a shortage in supply in the heating-oil relevant winter months. The bullish factors acting as a stimulus, oil prices breached several resistance lines in the course of the day, triggering technical buying orders. When the euro shed some of its earlier gains, oil's rise was halted but futures managed to recover later in the session and settled higher in the end.

ICE Gasoil contract for December delivery settled at 962.00 dollars on Tuesday. This was 12.00 dollars above Monday's settlement. With some 66,200 contracts the traded volume was slightly above average.

The Stochastic oscillator remains bullish at the ICE and NYMEX charts this morning. By breaching the 30% line the RSI indicator at the gasoil chart gave a buying signal yesterday exposing more upside to prices. ICE futures and the WTI crude are trading short of their yesterday's highs that mark today's first resistance lines. Technical analysts expect these resistance lines to be hit in the course of the day and a strong bullish momentum once those are breached as a string of automatic buying orders would be triggered. The first support for the WTI is at 98.25 dollars today, its first resistance is seen at 100.00 dollars. The Brent's first resistance is seen at 111.00 dollars, its first support is at 110.00 dollars.

U.S.

Nymex acces easing. Oil futures eased in Asia and on Globex electronic trading platform this morning, falling from the highest price in two weeks and paring a second monthly gain, as signs of rising U.S.crude inventories countered optimism about the health of the USeconomy. The traded volume is slightly below average. Market participants will eye the release of the DOE data and a string of US and European indicators for direction today.

API's: Crude oil +3.4; distillates +1.3; gasoline -0.2 million barrels vs previous week. Refinery utilization +0.5%

DOE's; due out tonight

Forecasts: Crude oil -0.2; distillates -1.2; gasoline +0.8 million barrels vs previous week

Houston (ex-wharf indications 29-11)

380cst $642
180cst $679
MGO $973

Very tight avails for 180 cst

New Orleans (ex-wharf indications 29-11)

380cst $644
180cst $682
MGO $976

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

Crude is jumping back up with WTI +$1.47. Singapore paper is in line with crude, gaining with +$6.05 for 180cst and +$6.25 for 380cst for Dec, and for Jan 180 cst +$5.90 and 380cst +$6.20 with MGO Dec contracts at +$1.21 and for Jan at +$1.21. The cargo market is bullish with 180cst +$9.41, 380cst +$10.13 and MGO -$0.10.

The Singapore fuel oil markets were up more than $9.50/mt during the Platts window. The delivered bunker premiums softened to around $13.75 above the cargo prices. Bunker demand was soft yesterday as outright prices rose. Bunker fuel oil swaps gained app. $11.00/mt at the front and $8.00-7.00/mt at the back end of the forward curve both for Rotterdamand Singapore papers. This morning both markets are trading lower.

High premiums for prompt deliveries.

380 cst $663
180 cst $673
MGO $925

Fujairah (delivered indications 30-11)

380cst $685
180cst $707
MGO $1040

Avails issue are sustaining the market.

ARA (Amsterdam - Rotterdam - Antwerp)

The Northwest European bunker values firmed Tuesday on stronger sentiment for FOB Rotterdambarges, that mirrored the $2/barrel rise day-on-day in Brent crude. Oil and equity markets were supported by the Italian bond auction that soothed Eurozone debt fears. Higher bunker prices, however, prompted reduced buying interest in ARAas shipowners were still cautious about the current upward trend in prices. Low stocks of high sulfur fuel oil are still reported, with suppliers experiencing delays due to ongoing congestion at loading installations.

Rotterdam

Indications for delivered bunkers:

380cst : $ 636
(1.0 %) :$ 670
180cst: $ 655
(1.0 %):$ 684
MGO 0.1%S: $970