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In the early afternoon oil prices have dipped, as the dollar has temporarily advanced. Later this afternoon however, they have regained ground, after the first resistances ICE Brent and NYMEX C.Oil proved strong and NYMEX floor trade had opened.

Oil futures at ICE and NYMEX had already continued retreating on Tuesday morning. Having breached their first short term supports technical profit taking increased, as already expected in our chart analysis. Later that day, Saudi Arabia provided more precise information as to a "fair oil price" and said it would raise its output in March and April to 9.9 million barrels per day. In case of supply shortages, production may be increased to 12.5 million barrels in no time. Reports saying that Libya's oil exports may already exceed pre-war output by next month also had a bearish effect on oil futures. Oil futures accordingly saw a sharp correction down, whereas the stronger dollar also prompted investors to take some profits in the early afternoon. Later the euro pared some of its losses against the dollar, limiting selling orders at oil markets. In the evening, oil futures at ICE and NYMEX pulled back from their lows but still settled with losses.

ICE Gasoil contract for April delivery settled at at 1,032.00 dollars on Tuesday. This was -11.50 dollars below Monday's settlement. With some 77,100 contracts the traded volume was above average.

The stochastic indicator's lines have already crossed at WTI charts this morning, giving investors a selling signal, whereas the indicator is still neutral at ICE charts. This morning, short term technical triangles have formed which define today's range. Supports at 123.75 dollars for the Brent and at 1,026.25 dollars for the Gasoil will therefore be decisive. If these are sustainably breached, the stochastic indicator might also cross at ICE charts showing yet another selling signal. Technical analysts expect some profit taking whereas market players are likely to avoid large riskier positions, as the DOE will publish weekly data on US oil inventories this afternoon.

U.S.

Nymex acces easing. Oil futures hardly changed in Asian trading hours and on Globex electronic trading platform this morning. The euro strengthening overnight resp. the retreating dollar slightly support oil markets. The traded volume is below average. Investors now look ahead to the development at European stock exchanges, further impulsions from forex trading and today's economic indicators. They will also eye the DOE's oil inventories data, to be published at 3.30 p.m.

API's: Crude oil -1.4; distillates +0.6; gasoline -1.4 million barrels vs previous week. Refinery utilization -0.4%
DOE's; Crude oil -1.2; distillates +1.8; gasoline -1.2 million barrels vs previous week. Refinery utilization -0.5%
Forecasts: Crude oil +2.64; distillates -1.0; gasoline -2.4 million barrels vs previous week

Houston (ex-wharf indications 20-3)

380cst $732
180cst $767
MGO $1063

Very tight avails for 180 cst

New Orleans (ex-wharf indications 20-3)

380cst $735
180cst $770
MGO $1066

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

Crude is slowing with WTI +$0.06 Singapore paper is ahead of crude, turning with -$2.05 for 180cst and -$1.00 for 380cst for Apr, and for May 180 cst -$2.05 and 380cst -$1.00 with MGO contracts Apr -$0.24 and May -$0.25. The cargo market is reacting with 180cst -$2.52, 380cst -$2.74 and MGO -$0.12.

The Singapore fuel oil markets were down around -$2.5 during the morning, tracking weaker crude movement. The delivered bunker premiums inched up slightly, assessed app. $3.0 above cargo prices. Front month bunker fuel swaps were strongly down yesterday. Prices lost more than $9.5, with prices at the back of the curve held much stronger shredding more than $5 from the backwardation discount between the front month and 2013 papers. This reflects some expectations of the stronger prices for the coming years. Calendar 2013 papers however, are still trading at a $50/mt discount against the front. This morning markets are trading slightly up.

High premiums for prompt deliveries.

380 cst $738
180 cst $750
MGO $1027

Fujairah (delivered indications 21-3)

380cst $737
180cst $759
MGO $1049

ARA (Amsterdam - Rotterdam - Antwerp)

Yesterday the ARA markets were weak, tracking falling crude, keeping buyers subdued. Slightly more lsfo is becoming available, and the tightness should be less pressing at the end of this week. In the MOC hsfo was traded between 702.50-705 usd and lsfo between 756-758 usd.

Rotterdam

Indications for delivered bunkers:

380cst : $ 708
(1.0 %) :$ 761
180cst: $ 731
(1.0 %):$ 762
MGO 0.1%S: $1025