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Fuel oil trend

Rotterdam: $ 3 higher.
Singapore: $ 4 lower.
US Gulf: $ 1 lower.

Russia, Iran, Libya and ECB (Brent: $104.6)

The most important intraday event to watch is the ECB interest rate decision (13.45 CET) – which will likely be a non-event, and the subsequent press conference at 14.30 CET. Inflation in the Euro Zone is way below the ECB target of 2%, and dangerously close to the dreaded deflation (negative inflation). Why should the oil market care? Well, if the governing Council of the ECB decides to implement another round of money printing using yet another acronym (LTRO, OMT, SMP, QE, etc take your pick.) it will have an immediate effect on oil price (up). Expect volatility to pick up around the press conference.

Libyan update: Rebels estimate oil exports to be up and running in 2-3 days. Now where have I heard that before, oh yeah - it must have been one of the other gazillion times this was reported in this year alone. Contrary to the knee-jerk reaction in the general oil market (Whoa, large amounts oil Libyan crude returning to the markets, better sell), we remain skeptical that this will mean a stable flow of Libyan oil into the global markets. With the other reported "restarts" in mind, it will probably play out something like this: rebels and the Tripoli government agree on terms. Oil starts flowing (let's give Libya the benefit of the doubt and say: +600,000 bpd), the parties disagree on terms after 2-3 weeks and oil stops flowing. Rinse and repeat.

Russia and Iran about to strike an oil-for-goods deal worth $20bn. Russia the world's top-producer of oil, and one of the top exporters should supposedly buy up to 0.5mbpd from Iran, and payment would be with Russian-made equipment/goods. It's really difficult not to draw the conclusion that this is a geopolitical card played by Russia to have more leverage over western countries in discussions regarding Crimea. Why else would a net exporting country basically swimming in oil, start importing?