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During morning trade, oil prices rose to fresh nine-month highs above $108 a barrel on Friday amid signs the U.S. economy is improving and elevated tensions in the Middle East over Iran's nuclear program, prompting market participants to take some profits. Thus ICE G.Oil has tested its first support at 1,032.50 dollars. Brent has also tested its first support at 123.35 dollars, but the bullish momentum is not yet breached. Only the WTI Crude has remained nearly unchanged and traded sideways. There has not been any decisive new or economic data this morning.

Oil futures started rising in early morning trading in London and New York, following their uptrends. First resistance lines breached as the rising euro that got support from a better-than-expected German indicator lent additional support. Strong resistance lines at 1,037.00 dollars (gasoil) and 106.70 dollars (WTI) limited the gains and the oil complex dropped as market participants took profit as the DOE was expected to report a strong build in crude oil stocks. When support lines at ICE and NYMEX proved strong, and the DOE data were rather neutral and had little influence on the oil market, investors reverted to a possible supply disruption of Iranian crude and the oil complex rebounded to settle higher in London and New York.

ICE Gasoil contract for March delivery settled at at 1,031.50 dollars on Thursday. This was 7.75 dollars above Wednesday's settlement. With some 54,300 contracts the traded volume was about on average.

Iran's nuclear work will go on, supreme leader Ayatollah Ali Khamenei said Wednesday, adding that his country had never been seeking an atomic weapon and that the nuclear program was for civilian use only. Short before, IAEA inspectors had left Tehran after negotiations had reached an impasse following a high-stakes, two-day visit to the Islamic republic and talks that failed to lift their suspicions of atomic weapons research. More and more, the market is now pricing in the real possibility that war in the region is inevitable. At any rate, the stakes continue to be raised. According to the National Iranian Oil Co. Iran will restart exporting its oil to French and U.K. companies if they sign long-term supply deals (2 to 5 years), but they wouldn't be allowed to send the oil to refineries in their countries. But experts reckon that both countries will refrain from signing long-term oil contracts as they contravene EU sanctions once they come into force. And British Shell and French Total had already stopped their purchases of Iranian crude ahead of the embargo.

While the Stochastic oscillators at the WTI and the brent chart don't give any clear signals this morning, the one for the gasoil is still slightly bullish. Even though the oil markets are meanwhile strongly overbought technical analysts see no significant downside to prices. Some profit taking ahead of the weekend could limit the upside, but an abrupt downward correction would only be triggered should the RSI indicator at the charts fall through the 70% line, the two lines of the Stochastic cross and the lower limits of the uptrend channels be breached. As long as these factors don't coincide, oil prices are seen consolidating on their high level with still some more upside.

U.S.

Nymex acces gaining. Oil futures trade in a narrow lateral range in Asian trading hours and on Globex electronic trading platform this morning, taking their breath after Thursday's late gains. The traded volume is about on average. Market participants will eye forex markets and a few economic indicators today.

API's: Crude oil +3.6; distillates +0.6; gasoline +0.3 million barrels vs previous week. Refinery utilization +2.9%
DOE's; Crude oil +1.6; distillates -0.2; gasoline -0.6 million barrels vs previous week. Refinery utilization +1.5%
Forecasts: Crude oil +0.3; distillates -0.8; gasoline +0.3 million barrels vs previous week

Houston (ex-wharf indications 23-2)
380cst $722
180cst $763
MGO $1067

Very tight avails for 180 cst

New Orleans (ex-wharf indications 23-2)

380cst $724
180cst $766
MGO $1069

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

Crude is surging again, after Yesterday's cooling with WTI +$2.12 Singapore paper is gaining still with +$6.25 for 180cst and +$6.25 for 380cst for Mar, and for Apr 180 cst +$6.25 and 380cst +$6.25 with MGO contracts Mar +$0.86 and Apr +$0.90. The cargo market is gaining only slightly with 180cst +$3.69, 380cst +$2.47 and MGO +$0.69.

The Singapore fuel oil markets only managed to rise around $2.5- 3.5 during Yesterday morning. The market continues to sell down as cargo premium softened. The delivered bunker premiums remained around $7.0- 8.0/mt above cargo prices. This morning markets are trading higher.

High premiums for prompt deliveries.

380 cst $730
180 cst $740
MGO $1010

ARA (Amsterdam - Rotterdam - Antwerp)

Although bunker values in the ARA edged higher Tuesday following higher outright 3.5% barge prices in Rotterdam, trading remained subdued as buyers were anticipating lower offer levels due to a closed arbitrage to the East. Antwerp is still experiencing some low sulfur fuel oil tightness due to shortages at local refineries.