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Technical indicators: bearish immediate term / neutral to bearish medium term

Oil prices dropped this morning on lingering worries on the US economy and bearish inventory data yesterday.

Yesterday, oil futures pared some of the earlier losses during the session at New York after DOE data showed the expected drop in crude inventories. The reopening of the Enbridge pipeline scheduled for early Friday and disappointing US economy data had applied pressure on oil prices earlier in the day.

Opec: Crude oil production from the 12-members averaged 29.11 million b/d in August, down 110,000 b/d from an estimated 29.22 million b/d in July, according to new data.

ICE gasoil October is expected to open 0.50 to 1.50 dollars lower at about 672.50 dollars/ton after settling at 673.50 dollars (official settlement price) Wednesday night. This was 3.75 dollars below Tuesday's settlement. Volume with some 73,200 deals above average.

WTI crude fell through the psychological 75.00 dollar support yesterday, giving markets more bearish momentum. The Stochastic indicator is still giving bearish signals this morning, the RSI returned to neutral. First WTI crude resistance line is seen at 76.00 dollars today, first support line at 74.65 dollars.

U.S.

Nymex Access trade: Oil prices were losing ground in Asian trading hours and NYMEX electronic trading this morning, extending Wednesday's late losses on a rising dollar and hopeful reopening of Enbridge's Canada-U.S. pipeline. WTI crude lingers just above 75.00 dollars for a barrel. No news in the markets.

APIs: crude oil +3.333; distillates -1.524, gasoline -0.963 million barrels vs previous week. Refinery utilization -0.6%

DOEs: crude oil -2.489; distillates -0.340, gasoline -0.694 million barrels vs previous week. Refinery utilization -0.6%

Forecasts: Crude oil -2.6; distillates +0.3; gasoline -1.1 million barrels vs previous week. Refinery utilization: -0.6%

Houston (ex-wharf indications 15-9)

380cst: $433
180cst: $455
MGO: $719

Very tight avails for 180cst

New Orleans (ex-wharf indications 15-9)

380cst: $436
180cst: $458
MGO: $722

Singapore (correct as of 1430hrs local time)

Crude is firming slightly with +$0.24 Singapore paper reflecting it with 180 cst +$1.00 and 380cst +$1.00 for Oct, and Nov 180 cst +$1.00 and 380cst +$1.00 with MGO Oct contracts at +$0.05 and for Nov at +$0.02. The cargo market is mixed with 180cst +$2.45, 380cst +$1.13 and MGO -$0.21.

The Singapore fuel oil price was up by app. $1.0 - 2.5/mt during the Platts window yesterday. The Singapore demand looks weak and soft. Cargo premium looks weak as well coming off to a discount of more than -$3.50/mt. Similarly, the delivered bunker premiums came off to $0.75 - 1.25/mt above the cargo. Singapore papers lost app. $1.75/mt along the curve. This morning markets are trading slightly up.

High premiums for prompt deliveries:

380cst: $443
180cst: $450
MGO: $665

Fujairah (delivered indications 16/9)

380cst: $445
MGO: $725

Rotterdam

Yesterday (Only barge trade deals of >2 KT reported) 30KT was traded in the MOC between 430.75-433.50 with Litasco as the main seller to Gunvor and Totsa as the main buyers.

NWE HSFO markets are firming on the back of reported fixtures, opening the Eastern arbitrage. The US influx dried up, and local suppliers are reluctant to meet short demand, to fully profit from the anticipated contango. The Med has seen some influx out of NWE, but the margins are very tight. The LSFO markets are balanced, with some Med demand surfacing, but tight on on-spec EU qualified product.

380cst: $435
(1.0%): $465
180cst: $454
(1.0%): $486
DMB: N/A
MGO 0.1%S: $675