---

Brent crude rose towards $110 a barrel on Thursday as violence in the Gaza Strip sparked worries about supply disruption and offset concerns that a slowing global economy could hit demand. Hamas fired dozens of rockets into southern Israel, killing three, and Israel launched numerous air strikes across the Gaza Strip as the military showdown lurched closer to all-out war.

Along with the stronger euro, oil futures edged higher on Wednesday morning testing their upward slack. While the technical situation was neutral the bearish sentiment apparently didn't prevail. European and US economic data came out rather disappointing, limiting oil futures' gains. In all, there were only few news yesterday, until late in the afternoon there have been reports that a militant Hamas-chief had been killed during an Israeli air raid. Only little later have oil futures exceeded the resistance lines that limited their technical triangle. This has triggered even more technical buying orders. Moreover, the front month contracts of the Brent and the WTI crude will expire today, resp. tomorrow. Therefore, investors particularly covered their short positions regarding these contracts accelerating the technical rise. Nevertheless, the price increase remained rather moderate, according to Tariq Zahir of Tyche Capital, who thinks that the news regarding the Hamas chief will not be bullish enough to change investor sentiment. Later on Wednesday evening, the US Fed published the FOMC's meeting minutes and the API released its weekly data on US oil inventories. These publications did not have any sustainable impact on oil prices, however, and so futures settled near their highs.

ICE Gasoil contract for December delivery settled at 928.25 dollars on Wednesday. This was 5.00 dollars below Tuesday's settlement. With some 56,700 deals the traded volume was on average.

The lines of the stochastic indicator have meanwhile crossed at the WTI and the Brent charts, giving market players a buying signal. At the Gasoil charts, the indicator is still rather neutral, see also technical analysis. Since oil futures have left their technical triangles yesterday, new upward leeway has developped - even thoug mid- and long-term resistance lines are out of reach. This rather speaks against a change of the trend. Technically markets are slightly bullish but most analysts expect prices to consolidate between 84.05 and 87.50 dollars (WTI).

U.S.

Nymex Access bullish: Oil prices have hardly changed in East-Asia and on Globex electronic trading platform this morning as new clues from the euro and market fundamentals are lacking. In Japan, the Nikkei has sharply climbed and might have a bullish impact on European trade. The traded volume is slightly above average. Market players now look ahead to the performance of stock markets, new clues from forex trade and today's economic data. Moreover they will eye the release of the DOE's data on US oil inventories at 5.00 p.m.

API: Crude oil +1.3; distillates +0.2; gasoline-+0.1 million barrels vs previous week
DOE: due out tonight
Survey: Crude oil +1.5; distillates -0.5; gasoline +0.2 million barrels vs previous week

Houston (ex-wharf indications 14-11)
380cst $610
180cst $713
MGO $1016

New Orleans (ex-wharf indications 14-11)

380cst $616
180cst $711
MGO $1021

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

The Singapore markets were up between +$1.0 to +$2.5 during the morning Platts window yesterday. The market was firmer on stronger buying interest narrowing the Asian Fuel Oil cracks. The delivered bunker premiums were around +$5.5 to $6.5 above cargo prices. Bunker fuel oil swaps gained app.$3.5/mt along the curve for Rotterdam papers. Singapore was a few cents weaker. This morning both markets are trading up.
High premiums for prompt deliveries.
380 cst $612
180 cst $622
MDO $930

ARA (Amsterdam - Rotterdam - Antwerp)

Although there are still a lot of waiting times at the loadinginstallations for HSFO, the avails for HSFO and LSFO are good.

Indications for delivered bunkers:
380cst : $ 595
(1.0 %) :$ 618
180cst: $ 625
(1.0 %):$ 648
MGO 0.1%S: $ 930