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This morning, ICE Brent and Gasoil futures have dropped below yesterday's lows, testing their downward potential. They have been pressured by profit taking regarding the WTI crude and the euro, as well as by the disappointing purchasing manager indices out of Europe. Ahead of the release of important statistics on the US labor market at 1.30 p.m. profit taking remained limited. Given yesterday's positive data on employment, market players expect that some 125,000 new jobs have been created (compared to 114,000 in the previous month). Therefore, most investors expect some bullish momentum in the early afternoon.

Despite of good Chinese economic data particularly distillate futures like the ICE Gasoil and the NYMEX Heating Oil have edged lower Thursday morning. After they had breached first supports, technical selling pressure has increased sending the Gasoil to a 3-year low at 939.75 dollars. According to analysts, profit taking has mainly been caused by the weaker demand against the backdrop of hurricane Sandy. Not only were there dents in demand from public and private transport, but also thousands of cancellations of flights in the region. The positive US economic data have provided some support in the afternoon but oil futures' rebound was merely a marginal and brief one. The DOE's data on US oil inventories have been bearish for products and bullish for crude oil futures. The WTI crude has marked the most gains after the release, while the other futures kept trading lower settling near their intraday-lows.

ICE Gasoil contract for November delivery settled at 942.25 dollars on Thursday. This was 15.75 dollars below Wednesday's settlement. With some 72,000 deals the traded volume was above average.

The technical indicators still don't point to any clear direction. While the stochastic indicator is still bullish at the WTI's chart, it remains bearish at ICE charts. The RSI scratched at the 30%-line at the WTI and Brent charts but remained unable to sustainably breach it. Thus the merely technical situation does not indicate any clear direction, the more so as futures - product as well as crude oil futures - still slightly diverge given the repercussions of hurricane Sandy. If ICE futures fall below yesterday's lows, however, there might be more technical selling. Moreover, the WTI might see some profit taking after Thursday's rise.

U.S.

Nymex access bearish: Oil futures have hardly changed in East-Asia and on Globex electronic trading platform this morning. Oil futures at ICE have tested their downward potential but have remained above yesterday's lows. The WTI crude has seen some profit taking. The traded volume is on average. Investors now look ahead to the damage reports regarding Hurricane Sandy, on the performance of stock and forex markets and some economic indicators, particularly the official statistics on the US labor market.

API's: Crude oil +2.1; distillates -2.6; gasoline -0.2 million barrels vs previous week. Refinery utilization +1.1%
DOE's; Crude oil -2.0; distillates -0.1; gasoline +0.9 million barrels vs previous week. Refinery utilization +0.5%
Forecasts: Crude oil +1.6; distillates -1.4; gasoline +0.0 million barrels vs previous week.

Houston (ex-wharf indications 1-11)

380cst $606
180cst $684
MGO $1035

New Orleans (ex-wharf indications 1-11)

380cst $610
180cst $685
MGO $1039

Singapore (correct as per 14:30hrs LT-delivered indications)

Crude is slightly up, gaining with WTI +$0.11. Singapore paper is bearish still with -$4.00 for 180cst and -$2.55 for 380cst for Nov, and for Dec 180 cst -$3.00 and 380cst -$2.50 with MGO contracts Nov -$1.20 and Dec -$1.15 The cargo market is starting to react to paper, losing with 180 cst -$6.69 380cst -$4.54 and MGO +$0.52.

380 cst $610
180 cst $620
MGO $920

ARA (Amsterdam - Rotterdam - Antwerp)

High sulfur bunker fuel oil premiums for prompt delivery in Rotterdam remain firm on ongoing delays at some loading installations and despite ample supply in the ex-wharf barge market. Premiums for prompt can reach $3/mt to $10/mt above normal bunker quotes. LSFO avails are good.

Rotterdam

Indications for delivered bunkers:

380cst : $ 589
(1.0 %) :$ 625
180cst: $ 620
(1.0 %):$ 655
MGO 0.1%S: $935