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Oil futures have retreated around midday after the first resistance lines for ICE G.Oil and Brent have proved strong although the euro has recovered from its 16-week trough against the dollar during morning trade. The WTI crude is currently testing its support at 100.85 dollars. As there has not been any decisive news or economic indicators this morning, market participants have eyed the euro/dollar parity. This will probably continue this afternoon.

Oil futures started the day on a positive note on Friday as the euro halted its decline and investors hoped for good news from the USlabour market. However, when the dollar got a lift after reports showed a decrease in unemployment in the afternoon, market participants retreated from dollar-nominated oil and took profit. First short-term support lines were breached, but little volume ahead of the weekend and more solid supports initiated a technical upward correction late in the session.

After Iran's navy finished its military excercises in the Strait of Hormuz last week navy officials plan to carry out another manoeuvre in the region. Observers feel that Iran intends to position its fleet to prepare for a closure of the important oil route. But Muhammad Ali Khatibi, Iran's governor with the Organization of Petroleum Exporting Countries, reiterated that "our main policy is to supply our crude to markets. We are one of the reliable sources" of oil.

ICE Gasoil contract for January delivery settled at 960.75 dollars on Friday. This was 5.75 dollars below Thursday's settlement. With some 43,700 contracts the traded volume was little below average.

The stochastic oscillators at the ICE and NYMEX charts are bearish this morning, giving markets a selling signal. Still, technical analysts assess the situation as rather neutral as the RSI indicator at the ICE charts still lingers above the 70% line and is already in the neutral area at the WTI chart. Support lines are seen being hit today but only if they are breached more technical selling orders will be triggered.

U.S.

Nymex acces gaining. Oil futures traded lower in early Asian trading but are recovering on Globex electronic trading platform as the euro rises compared to the dollar and investors eye a meeting of Merkel and Sarkozy in Berlin. The traded volume is above average. There are no important economic indicators on the agenda today, so market participants will turn to forex for direction.

Houston (ex-wharf indications 6-1)

380cst $667
180cst $703
MGO $1007

Very tight avails for 180 cst

New Orleans (ex-wharf indications 6-1)

380cst $669
180cst $705
MGO $1009

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

Crude is easing somewhat, after the recent bullish sentiment with WTI -$0.89. Singapore paper is mirroring it, losing with -$6.20 for 180cst and -$5.75 for 380cst for Jan, and for Feb 180 cst -$5.55 and 380cst -$2.30 with MGO Jan contracts at -$5.55 and for Feb -$2.30. The cargo market is slowing, but not yet turning with 180cst +$5.61, 380cst +$6.70 and MGO +$2.14.

High premiums for prompt deliveries.

380 cst $718
180 cst $731
MGO $957

Fujairah (delivered indications 9-1)

380cst $713
180cst $736
MGO $1050

ARA (Amsterdam - Rotterdam - Antwerp)

Bunker fuel values across Northwest Europe rose again Wednesday, with the fuel oil complex across the region bolstered by a firm underlying ICE Brent crude market. ICE Brent rallied on ongoing concerns over the EU/Iranian crude import relationship. Rotterdam high sulphur fuel oil barges were assessed at a premium of $21.25/mt to their comparable front-month swaps Wednesday, an unprecedented level on the back of a strong Singapore market and the anticipation of arbitrage flows from Rotterdam to the Asian hub. While a few vessels are slated to load January and two more load February, market participants expected a flurry of fixtures and to see the Rotterdam market tighten further.

Rotterdam

Indications for delivered bunkers:

380cst : $ 672
(1.0 %) :$ 694
180cst: $ 688
(1.0 %):$ 712
MGO 0.1%S: $970