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Brent crude rose to almost $110 a barrel as the escalating violence between Israel and the Palestinians fuelled concern about supplies from the Middle East. Investors fear the conflict may draw in other countries and possibly disrupt energy exports from the region, which supplies more than a third of the world's crude. Brent crude for January delivery was up $1 to $109.95 and U.S. crude futures gained 80 cents to $87.72 a barrel.

Oil futures at ICE and NYMEX already traded with a steadier tendency on Friday morning as the conflict between Israel and Hamas in the Gaza Strip boosted the risk premium. While quotations were unable to exceed their first resistance lines in the morning, in the afternoon the latter were breached triggering a technical upward reaction. At forex markets investors turned to safe haven currencies like the US dollar. This slightly limited the upward potential at oil markets. Beside the worse-than-anticipated economic indicators and the API's bearish statistics on US oil demand in October, market participants seized the earlier gains for some profit taking. In the evening, however, the bullish impact of the conflict in the Gaza Strip predominated.

ICE Gasoil contract for December delivery settled at 920.50 dollars on Friday. This was 10.50 dollars below Thursday's settlement. With some 43,700 deals the traded volume was below average.

The stochastic indicator is bullish both at ICE and NYMEX, with the WTI crude already testing its first important resistance line at 87.85 dollars. If the WTI crude exceeds this level in the course of the day, there will be more upward potential and the WTI crude might even test the 89.70 dollars in the coming days. However, focus will remain on the developments in the Near East this week that influence the risk premium. Currently, it is more likely that oil prices will continue testing their upward slack and so technical analysts still assess the situation as slightly bullish.

U.S.

Nymex Access steady: Oil prices have traded more steadily in East-Asia and on Globex electronic trading platform this morning while Asian equities and the euro have also gained some ground. The ongoing conflict in the Near East might have a greater impact on oil prices, though. The traded volume is slightly above average. Investors now look ahead to the performance of stock markets, new clues from forex trade and today's economic data. Moreover they will keep an eye on the development of the conflict in the Gaza Strip.

Houston (ex-wharf indications 16-11)
380cst $610
180cst $716
MGO $1025

New Orleans (ex-wharf indications 16-11)

380cst $617
180cst $710
MGO $1034

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

Crude is steady with WTI +$1.87. Singapore paper is bullish, going up with +$3.75 for 180cst and +$5.20 for 380cst for Nov, and for Dec 180 cst +$4.30 and 380cst +$4.30 with MGO Nov contracts at +$1.26 and for Dec at +$1.26. The cargo market is steady with 180cst -$1.56, 380cst -$1.49 and MGO -$0.92.

The Singapore markets fell app.$1.5 during the morning window last Friday. The fundamentals did not seem to have improved with soft demand and ample supply. The delivered bunker premiums were around +$5.0 to $6.5 above cargo prices last Friday. This morning the markets are trading up.

High premiums for prompt deliveries.

380 cst $617
180 cst $626
MDO $930

ARA (Amsterdam - Rotterdam - Antwerp)

One supplier in Rotterdam continued to indicate operational delays of up to 48 hours at certain refineries for both LSFO and HSFO deliveries. Antwerp continued to run short of HSFO, so is expected that when received offers for prompt deliveries, there will be higher premiums. The HSFO is expected to stay firm as there is still no news on replenishment.

Indications for delivered bunkers:
380cst : $ 595
(1.0 %) :$ 623
180cst: $ 625
(1.0 %):$ 653
MGO 0.1%S: $ 930