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Supported by the rise in the euro and gaining equity markets oil prices have rebounded from first supports in the morning. After the nuclear talks were interrupted without the parties having come to an agreement traders seem to cover speculative short positions ahead of the long weekend. WTI rose above its first resistance line but the resistances at the ICE are still strong, limiting the gains.

Oil futures lost more ground in London and New York in electronic morning trade, falling as low as their third supports at the ICE as little encouraging indicators in China and the euro zone pushed equities and the euro lower on a rising risk aversion. When the 105.00 dollar support for the brent, and the 896.50 dollar support for the G.Oil proved strong, a technical upward correction helped oil back up from intraday lows. Before, the WTI had slipped below the important 90.00 dollar support for the second time this year. When the euro and equities recovered in the afternoon, the positive sentiment spread to oil markets where traders cautiously considered the ongoing talks on Iran's nuclear program. The longer the talks dragged on the more hope faded that the two parties would come to an agreement so that investors started to cover their short positions and oil prices revealed some upside. Strong resistances at 910.00 dollars (G.Oil) and 91,50 dollars (WTI) limited the gains, however, the bearish market sentiment taking over. Only late in the evening it was clear that no progress had been made in Baghdad and that talks will be resumed in June.

ICE Gasoil contract for June delivery settled at 905.50 dollars on Thursday. This was 2.25 dollars above Wednesday' settlement. With some 52,300 contracts the traded volume was about on average.

OPEC: The OPEC members may keep their output ceiling unchanged when they meet in June 14 despite the recent steep drop in oil prices. Due to this price correction Brent has dropped more than 20 dollars since mid-March and is now close to 100 dollars a barrel, a level acceptable to most OPEC members. So the Gulf countries don't see a need for change at the moment. Iran initially protested against the Saudi-led output rise as the members had agreed on a ceiling of 30 million barrels a day in December. OPEC is producing more than a million barrels a day above this ceiling. But Tehran has toned down its criticism following talks with the West on its nuclear program. When asked on the OPEC meeting, Iran's oil minister Rostam Ghasemi said that it "would examine the supply-and-demand situation at its next meeting and will make a decision in this regard." The next OPEC meeting is scheduled for June 14 in Vienna.

Neither the RSI nor the Stochastic are giving any clear signals this morning and are both considered as neutral. The technical downtrends remain intact but markets are oversold encouraging a technical upward correction. The RSI approaches the 30% line and will give a buying signal should the line be breached. Still, the WTI's fall through the psychologically important 90.00 dollar support opens more downside below this level. So technical analysts are neutral this morning.

U.S.

Nymex access losing: Oil futures dropped in East-Asia and on Globex electronic trading platform this morning, brent crude slipping towards 106.00 dollars, on track for a fourth weekly loss as Asian equity markets didn't get back on track and the euro lingered on its low level vs the dollar. The traded volume is about on average. As there are only a couple of less important indicators on the agenda today, investors eye stock and forex markets for direction.

Houston (ex-wharf indications 25-5)

380cst $627
180cst $691
MGO $955

New Orleans (ex-wharf indications 25-5)

380cst $633
180cst $691
MGO $955

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

The Singapore fuel oil markets lost more than $10.25 during the morning window yesterday. The delivered bunker premiums edged up app. $7.5 above cargo prices yesterday as stronger crude prices lifted offers. Bunker fuel oil swaps gained up to $3.5/mt at the front of the forward curve. Backend was significantly weaker, assessed only a few cent up from previous day close. This morning markets are trading higher.

High premiums for prompt deliveries.

380 cst $635
180 cst $645
MGO $890

ARA (Amsterdam - Rotterdam - Antwerp)

On the back of tight avails barge schedules, hsfo and lsfo levels in ARA are surging. VLCC's are reported loading soon, heading for Asia. Most suppliers are fully booked till the end of the month.

Rotterdam

Indications for delivered bunkers:

380cst : $ 624
(1.0 %) :$ 664
180cst: $ 648
(1.0 %):$ 688
MGO 0.1%S: $900