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After having seen a slight technical correction up, oil futures have consolidated on a low level. As important economic indicators are lacking, there are no decisive impulsions ahead of the weekend. The bearish technical constellation might cause some downward movement in the afternoon should first resistances prove strong.

Oil rose right from the start in electronic morning trading yesterday and poised on their high level until the opening of the session in New York when technical selling orders set in after resistance lines could not be breached. Oil then reversed its course, the WTI crude sinking to its lowest in a month when investors took profit despite a couple of positive US indicators, sending oil as low as the medium-term support lines where the WTI's 93.35 dollar support stopped oil's slide.

OPEC presented its Wednesday agreement as a decision to keep output flat, but recent production data suggests the deal could result in a near-term supply cut. OPEC agreed to limit its oil production to 30 million barrels a day, which is close to where most market analysts see the average demand for its crude in 2012. However, recent revelations about higher-than-expected oil production in Saudi Arabiaand Libyasuggest that 30 million barrels a day may be significantly below current OPEC oil production. The cartel produced 30.37 million barrels a day of oil in November, however, this does not reflect recent increases in production. Saudi Oil Minister Ali Naimi said his country actually produced 10.05 million barrels a day of oil in November, 450,000 barrels a day above the official OPEC figure. According to OPEC Secretary General Abdullah Salem El-Badri, Libyais now producing 1 million barrels of oil a day, 430,000 barrels a day above the OPEC estimate for November. If these production levels were to continue to the end of the year, total OPEC production could be running 1.25 million barrels a day above the new production ceiling when it comes into force in January. But if OPEC members move swiftly to follow the deal, that could leave markets short. The International Energy Agency, which represents major energy-consuming rich countries, also expressed concern about the short-term effect of the new output ceiling should there be a prompt cutback.

ICE Gasoil contract for January delivery settled at 898.25 dollars on Thursday. This was 6.50 dollars below Wednesday's settlement. With some 59,700 contracts the traded volume was about on average.

The Stochastic oscillators at the NYMEX and ICE charts are bearish, but still at the oversold level. So analysts expect a technical upward correction in the morning, similar to the one yesterday, and see prices consolidate later on with risks skewed to the downside as the bearish Stochastic oscillators will limit gains and support lines might be hit.

U.S.

Nymex acces gaining. Oil futures are rising in East Asiaand on Globex electronic trading platform this morning in a technical reaction to yesterday's late losses, as investors speculated that the biggest weekly decline since September is exaggerated and the WTI's strong support at 93.35 dollars triggered some technical buying orders. The traded volume is about on average.

Houston (ex-wharf indications 15-12)

380cst $617
180cst $655
MGO $944

Very tight avails for 180 cst

New Orleans (ex-wharf indications 15-12)

380cst $619
180cst $658
MGO $947

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

Crude is bearish still, losing with WTI -$2.02. Singapore paper is easing with -$3.55 for 180cst and -$4.50 for 380cst for Dec, and for Jan 180 cst -$3.80 and 380cst -$4.50 with MGO Dec contracts at -$1.35 and for Jan -$1.35. The cargo market is fully adopting the bearishness with 180cst -$16.51, 380cst -$16.39 and MGO -$3.02.

The Singapore fuel oil markets were up more than +$5.5 during the Platts window yesterday tracking crude. The Singapore fundamentals seem to be improving forward as the cargo premium softened and also more reported cargoes incoming. The delivered bunker premiums were around $19.00 yesterday. Bunker fuel oil swaps were down more than $16/mt at the front and nearly $18/mt at the backend of the forward curve both for Rotterdam and Singapore papers. East/west spread remains rather broad trading around $40 for January. Viscosity spread between 180cst and 380cst papers broadened notably especially in the front, trading at app. $13/mt for January. Markets are trading slightly higher this morning.

High premiums for prompt deliveries.

380 cst $652
180 cst $671
MGO $932

ARA (Amsterdam - Rotterdam - Antwerp)

Market sentiment in Northwest Europe was mixed Thursday following weaker values in the main bunker hub of Rotterdam that tracked softer 3.5% FOB Rotterdam barges. Suppliers in Rotterdamand Antwerp continued to see some buying interest HSFO and low sulfur fuel oil supplies in Rotterdam and Antwerp continued to cause delays at loading installations, with prompt supplies become a bigger problem every single day. LSFO availability is very tight with the hi-lo spread continued to rise on LSFO shortages.

Rotterdam

Indications for delivered bunkers:

380cst : $ 600
(1.0 %) :$ 648
180cst: $ 615
(1.0 %):$ 664
MGO 0.1%S: $905