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Brent crude oil held above $108 a barrel on Friday as traders eyed a restart of ports in eastern Libya and a possible scaling back of the U.S. Federal Reserve's massive stimulus programme. The Libyan government is set to reopen three eastern ports on Sunday that could increase output at the OPEC producer from the current 250,000 barrels per day (bpd). Upbeat economic data from the United States has heightened speculation that the U.S. Federal Reserve may start trimming its bond purchases next week, a move that could strengthen the dollar and weigh on demand for dollar-denominated commodities such as oil. But stronger U.S. economic growth could also lead to higher fuel demand in the world's largest oil consumer. January Brent was down 10 cents at $108.57 a barrel by 0930 GMT, after falling more than $1 on Thursday. U.S. crude futures for January were down 10 cents at $97.40.

ICE Gasoil contract for January delivery settled at 925.50 USD on Thursday. This was -7.00 USD below Wednesday's settlement. With some 75,000 deals, the traded volume was far below average.

Since the technical situation was slightly bullish (the stochastic indicator gave a buying signal at Brent chart) and as oil futures kept track of their gains on Wednesday, prices in London and New York initially tested their upward potential on Thursday morning. As to Gasoil, many investors also shifted their riskier positions of the December contract to the contract with later delivery as the December contract expired yesterday afternoon. Early in the afternoon, quotations marked new highs before slumping only little later. Spreadbets that had buoyed Brent and product futures after the release of the DOE's oil inventories data on Wednesday were then cut. In the aftermath of the US oil inventories data, the bearish builds in product stocks and the sharp decline in US demand showed their impact and, along with expectations of a rise in Libyan output, weighed on oil prices. Brent and Gasoil breached several support against the backdrop of rather bearish market fundamentals. This generated further technical stop loss orders that frequently accelerated the decline. ICE futures eventually settled near new lows whereas WTI held relatively steady above its first support thanks to the bullish draw in US crude oil stocks. The spread between Brent and WTI thus significantly narrowed yesterday amounting to about 11 USD.

The buying signal of the stochastic indicator waned at the Brent chart yesterday as the signal was not confirmed at the Gasoil chart. At ICE, neither the RSI nor the stochastic indicator are currently giving any new cues. At the WTI chart, the stochastic indicator stays bearish as the indicator has fallen below 50%, with its lines continuing to diverge. The RSI currently is above 70%. It might provide a selling signal if it drops below this level. This morning, we rather focus on the technical situation at ICE charts again which is neutral this morning. If the RSI gives a new selling signal at the WTI in the course of the day, it might also have a bearish effect on quotations at ICE.

U.S.

Nymex neutral: After yesterday's losses, oil futures at ICE edged higher in early morning trade. However, they soon retreated again trading now nearly unchanged near Thursday's lows. The traded NYMEX volume is slightly below average for this time of day. Investors are looking ahead to the opening of European stock and forex markets. Moreover, they look ahead to the release of some economic indicators.

Houston (ex-wharf indications 10-12)
380cst $597
180cst $670
New Orleans (ex-wharf indications 10-12)
380cst $617
180cst $652
MGO $991

Singapore

WTI is neutral with -$0.04. Singapore paper is loosing with -$5.00 for 180cst and -$4.50 for 380cst for Dec, and for Jan 180 cst -$5.50 and 380cst -$4.50 with MGO contracts Dec -$1.12 and Jan -$1.27. The cargo market is bullish with 180 cst +$1.97, 380cst +$1.08 and MGO +$0.46.

The Singapore heavy residual inventory saw a build of +1.44 mbbl to 22.23 mbbl citing weaker demand especially from the bunker sector. The delivered bunker premiums were app. $5.5 above cargo prices yesterday. This morning markets are trading slightly higher.

380cst $602
180cst $609
MGO $925

Fujairah (delivered indications 13-12)

380cst $622
180cst $668
MGO $1005

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $578
(1.0 %) : $620
180cst: $608
MGO 0.1%S: $ 895