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As expected, market participants remain cautious ahead of the publication of the DOE's data and of the decision on the OPEC's production quota this afternoon. In a thin trade, oil futures remained mainly unchanged this morning in relation to yesterday's settlement. Further impetus is only expected in the afternoon. If the OPEC decides on a change of its quota, contrary to expectations, the decision will definitely have some impact on the markets. The DOE's data will probably only show a significant impact on oil prices if there are considerable builds in crude oil or product stocks.

Oil futures consolidated in electronic morning trading Tuesday, hitting first support lines early in the day which at that time of the day proved strong. Rising European equity markets that were boosted by a positive ZEW indicator also supported the oil complex. First short-term resistance lines were breached on technically driven buying orders in an oversold market but gains were limited by a strong 108.50 dollar resistance at the Brent chart and 98.70 dollar resistance for the WTI. During NYMEX session, oil futures suddenly leapt over several more resistance lines in just minutes on a market rumor that Iranclosed a major oil-shipping channel, but later pared some of their earlier gains as the rumor proved untrue. The euro lost considerable ground vs the dollar on a rising risk aversion and fell through a series of support lines.

When ministers from the Organization of Petroleum Exporting Countries meet today they are expected to maintain their official output quota. The oil ministers of Iranand Saudia Arabia met yesterday to exchange their views on 2012 oil demand. Iran's oil minister Ghasemi said after the meeting he expects oil demand to decline next year while the Saudi minister Naimi made no statement. Yet, OPEC officials in recent days have said the most likely course of action is that OPEC will decide to maintain current output, a move that appears to have broad support from different fractions of the organization. A status-quo result would be to keep output at 30 million barrels a day while Saudia Arabia would we urged to reduce its output that had reached a 30-year high in November.

ICE Gasoil contract for January delivery settled at 932.50 dollars on Tuesday. This was 9.50 dollars above Monday's settlement. With some 87,900 contracts the traded volume was well above average.

When the two lines of the Stochastic oscillator crossed at the oversold level, a strong buying signal was triggered. Still, technical analysts are rather neutral today as yesterday's surge was initially triggered by the canard of the shipping channel closure and most of the bullish potential was used up by Tuesday's rally. The resistance lines at 110.00 dollars for the brent and 101.00 dollars for the WTI crude, that could not be breached yesterday, are seen strong also today. The strong dollar should tempt traders to take some profit and with the OPEC meeting and DOE data ahead there will be little trading volume in the morning. The first support for the WTI is at 98.55 dollars today, its first resistance is seen at 100.50 dollars. The Brent's first resistance is seen at 110.00 dollars, its first support is at 108.80 dollars.

U.S.

Nymex acces gaining. Oil futures consolidate on their high level in Asia and on Globex electronic trading platform this morning, taking their breath after Tuesday's overdone rally. The traded volume is clearly below average. Market participants will likely be cautious ahead of the release of the DOE data and the result of the OPEC meeting today.

API's: Crude oil +0.5; distillates +1.2; gasoline +/- 0.0 million barrels vs previous week. Refinery utilization -1.6%
DOE's; due out tonight
Forecasts: Crude oil -2.2; distillates +1.4; gasoline +0.8 million barrels vs previous week

Houston (ex-wharf indications 13-12)

380cst $627
180cst $664
MGO $963

Very tight avails for 180 cst

New Orleans (ex-wharf indications 13-12)

380cst $630
180cst $666
MGO $966

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

Crude is bouncing up, gaining with WTI +$1.81. Singapore paper is reflecting the bullish sentiment, gaining with +$6.85 for 180cst and +$6.95 for 380cst for Dec, and for Jan 180 cst +$6.85 and 380cst +$6.95 with MGO Dec contracts at +$1.22 and for Jan +$1.20. The cargo market is starting to react to the bullishness, gaining with 180cst +$0.19, 380cst -$0.01 and MGO +$0.14.

The Singapore fuel oil markets were soft, down slightly flat to -$1 during the Platts window yesterday. Market continued to be firm in the short term but incoming supplies looks likely to improve the demand supply balance. The delivered bunker premiums were around $19.50 above the cargo prices yesterday. This morning markets are trading slightly higher.

High premiums for prompt deliveries.

380 cst $659
180 cst $681
MGO $949

ARA (Amsterdam - Rotterdam - Antwerp)

Bunker values in some Northwest European bunker hubs rose by up to $9-10/mt from Monday to Tuesday as crude futures rallied $ 3/barrel amid rumors the US Federal Reserve may announce another round of quantitative easing. However, trading activity remained weak. High and low sulfur fuel oil supplies in Antwerp continued to tighten.

Rotterdam

Indications for delivered bunkers:

380cst : $ 620
(1.0 %) :$ 664
180cst: $ 635
(1.0 %):$ 679
MGO 0.1%S: $935