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Oil prices are posting strong gains on the back of an bolstering EURO as expectations the weaker than expected economic data from China last Friday will force the Chinese into launching a further stimulus programme along with the ECB and FED.

Oil futures have traded lower Friday morning as disappointing figures regarding China's exports weighed on sentiment. The European debt crisis and the weakening US economy seem to have a deeper impact on Chinese economy than expected. The IEA's bearish monthly report, that contained a lower forecast of oil demand as than the previous report, also prompted investors to take some profit and so oil futures have breached their first supports by the early afternoon. The stochastic indicator's selling signals at ICE and NYMEX charts triggered more technical selling orders. Losses have been capped by the WTI crude's strong support at 91.75 dollars. Along with the steadier euro and advancing equities, this triggered a counter-reaction in late-afternoon trade. The Fed of Philadelphia significantly lowered its forecast regarding US economic growth in the third quarter from +2.5% to 1.6%. This has caused a renewed rise at stock markets and in forex trade as investors' hopes on new measures of quantitative easing (at least in September). These gains also buoyed oil prices in the afternoon. While the Brent and the WTI crude nearly completely pared their losses in late trade, NYMEX Heating Oil and ICE G.Oil have climbed less.

ICE Gasoil contract for September delivery settled at 955.00 dollars on Friday. This was 5.75 dollars above Thursday's settlement. With some 88,300 contracts the traded volume was above average.

The stochastic indicator remains bearish for the WTI this morning but does not give any selling signal at ICE charts anymore. The market situation is still significantly overbought and so, in all, we regard the technical situation as slightly bearish. Technical analysts have not given any clearly bearish jugdements yet, as markets are still predominated by hopes on measures of monetary policy and other macro-economic factors outweighing the technical clues. However, if the stochastic indicator or the RSI gives new selling signals, selling pressure might renewedly increase and cause some profit taking.

U.S.

Nymex access gaining: Oil futures edged higher in East-Asia and on Globex electronic trading platform this morning continuing Friday's late rise. The Brent has marked a new 3-month high, whereas futures have already slightly pulled back from their highs as decisive news have been lacking in the early morning. The traded volume is on average. Market participants now look ahead to the performance of stock and forex markets. As to economic indicators, there is only the German wholesale price index on the agenda.

Houston (ex-wharf indications 10-8)

380cst $636
180cst $671
MGO $990

New Orleans (ex-wharf indications 10-8)

380cst $638
180cst $673
MGO $1000

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

Crude is slowing, but gaining still with WTI +$0.45. Singapore paper is up only marginally with +$1.30 for 180cst and +$1.30 for 380cst for Aug, and for Sep 180 cst +$0.75 and 380cst +$0.75 with MGO contracts Aug +$0.19 and Sep +$0.22. The cargo market is mirroring crude and paper, gaining with 180cst +$3.16, 380cst +$4.27 and MGO +$2.00.

The Singapore fuel oil market reopened after a one day break on holiday with prices rising about +$3.0 during the morning window last Friday. The latest Singapore heavy residual oil inventory saw a build of +1.4 mbbl to 21.26 mbbl. The delivered bunker premiums fell to around $6.50 above cargo prices last Friday. This morning markets are trading higher.

High premiums for prompt deliveries.

380 cst $655
180 cst $668
MGO $960

ARA (Amsterdam - Rotterdam - Antwerp)

After last week's bullish end, the week continued with the bullishness. Continuing loading delays up to three days are reported. With short cutter stocks underpinning the markets and a heavy maintenance programme for September with two important North Sea oilfields set for a one month closure. High premiums are charged for prompt enquiries.

Rotterdam

Indications for delivered bunkers:

380cst : $ 642
(1.0 %) :$ 702
180cst: $ 684
(1.0 %):$ 747
MGO 0.1%S: $955