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Oil prices were little changed in European trade this morning, steadying below the prior session’s three-month highs as investors shifted their focus back to a global supply glut.

From a merely technical perspective selling signals of the Stochastic indicator favoured tests of the downside at oil markets on Wednesday morning. However, the uptrend remained intact and so the selling signals failed to generate further downward potential. The API's data on US petroleum stockpiles came in mixed whereas the EIA's monthly energy report and the Kuwaiti oil minister's comments (Kuwait won't limit output, if not all majors cut) didn't provide bullish cues. Market fundamentals were thus slightly bearish. Nonetheless, investors kept covering their short-positions pushing prices above the first resistances in the first half of the day. The price increase was limited by the Gasoil's strong resistance at 364.50 USD. WTI's gains were capped by the resistance at 37.35 USD. As fresh cues were lacking, oil futures consolidated near these levels in the early afternoon. Market players looked ahead to the release of the DOE's data, which brought buying cues at 4.30 p.m. showing a rise in product demand and a sharp draw in product stockpiles. Oil futures posted fresh highs but Brent failed to sustainably breach its psychological resistance at 41.00 USD. Gasoil but briefly climbed above its 364.50 USD, eventually remaining captured between the two resistances at 360.25 and 364.50 USD. Along with NYMEX Gasoline, WTI gained the most ground, hitting a fresh 3-month high at 38.51 USD.

ICE Gasoil contract for March delivery settled at 362.75 USD on Wednesday, this was 3.00 USD above Tuesday's settlement. With some 47,400 deals, the traded volume (front month) was below average.

The bearish signals of the Stochastic indicators waned thanks to Wednesday's rise in oil futures. This Thursday the indicator doesn't give off any selling signals - neither at ICE nor at NYMEX charts. The uptrends remain intact. Brent and WTI failed to sustainably break above their key resistances at 41.00 USD and 38.40 USD, respectively. Wednesday's highs are likely to limit the upside today. If oil futures break above these levels, prices might continue rising, testing the resistances which limit the uptrends. If oil futures edge lower, the Stochastic indicator might renewedly give off selling signals. In this case, oil futures might test their supports. Overall, we assess the technical constellation as neutral this morning.

U.S.

Nymex above average: Oil futures at ICE and NYMEX edged lower in electronic trading this morning as the key resistances (Wednesday's highs) remained strong. The traded volume at NYMEX is above average this morning. Market players are now waiting for the European financial and forex markets to open as well as for the release of the economic indicators due this Thursday. Moreover, they will eye the results of the ECB's meeting.

Forecast: Crude oil +3.1; Distillates -0.5; Gasoline -1.5 million barrels vs previous week.
DOE: Crude oil +3.9; Distillates -1.1; Gasoline -4.5 million barrels vs previous week.
API: Crude oil +4.4; Distillates -1.1; Gasoline -4.5 million barrels vs previous week.

Houston (ex-wharf indications 10-3)
380cst $160
180cst $303
MGO $362

New Orleans (ex-wharf indications 10-3)
380cst $167
180cst $211
MGO $354

Singapore (delivered indications 10-3)

Brent is bullish with +$0.90 for Apr contracts. Singapore paper is up with +$10.00 for 180cst with +$10.50 for 380cst for Mar, and for Apr 180cst +$9.25 and 380cst with +$9.05 with MGO contracts Mar with +$0.73 and in Apr with +$0.76 .The cargo market is down with 180cst -$1.40, 380cst with -$1.34 and MGO with -$0.58.

380cst $175
180cst $180
MGO $335

Fujairah (delivered indications 10-3)

380cst $177
180cst $198
MGO $419

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $173
MGO 0.1%S: $363