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Technical indicators: neutral to bullish

Oil prices trade sideways and the euro continues to limp along against other major currencies in European trading hours, held under steady but clear pressure against the dollar. Fresh military tensions on the Korean peninsula kept traders a little nervous. That in turn generated support for the dollar which is treated as a safe retreat in times of stress.

Friday, oil prices shed earlier gains during the session in New York and settled slightly lower vs the previous day as the dollar regained ground vs the euro.

ICE gasoil Januari is expected to open 0.50 to 1.50 dollars down at about 765.50 dollars/ton after settling at 766.50 dollars (official settlement price) Friday night. This was 2.75 dollars below Thursday's settlement. Volume with some 28.900 deals below average.

The lateral trendchannel is still intact. Both RSI and Stochastic indicator are regarded as neutral this morning. In thin pre-holiday trading the technical constellation remains the important factor. A strong first support for the WTI crude is seen at 87.00 dollars, the first resistance at 88.50 dollars. Should the 87.00 dollars hold, crude is seen moving higher above 90.00 dollars in January. But the rally would be the last run of strength before a pending down-cycle unfolds, according to technical analysts. The crude’s chart is also showing bear divergence, where peaks in the RSI and Moving Average Convergence/Divergence indicators aren’t getting progressively higher.

U.S.

Nymex Access: Oil prices are little changed in Asian trading hours and NYMEX electronic trading this morning, WTI crude lingering below 88.00 dollars. Freezing temperatures in the Northern Hamisphere lend some support. No news in the markets. The traded volume is above average.

Houston (ex-wharf indications 17/12)

380 cst $491
180 cst $508
MDO $774

Very tight avails for 180 cst

New Orleans (ex wharf indications 17/12)

380 cst $494
180 cst $511
MDO $777

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

Crude is slowing, but losing still with WTI -$0.46. Singapore paper is back on its bearish track with Dec -$2.75 for 180 cst and -$2.75 for 380 cst, and for Jan 180 cst -$2.80 and 380cst -$2.80 with MGO Dec contracts at -$0.20 and for Jan at -$0.18. The cargo market is slowing with 180cst +$1.93, 380cst +$1.50 and MGO +$0.16.

The During the Platts window the Singapore fuel oil market went up more than $1.5/mt last Friday. The Singapore inventory was up by 0.5 mbbls to 21.94 mbbls as current high outright prices are dampening bunker demand. The delivered bunker premiums were assessed $1.5 to $2.5 above cargo prices.

High premiums for prompt deliveries.

380 cst $506
180 cst $519
MGO $773

Fujairah (delivered indications 20/12)

380cst: $502
180cst: $518
MGO: $790

Rotterdam (delivered indications)

Last Friday (Only barge trade deals of >2 KT reported) In the MOC 110KT was traded between 483.00-485.50 with Totsa, Petroned as the main sellers to Litasco as the main buyer.

The NWE HSFO markets are well supplied, although the open Eastern arbitrage supports the local markets. The HSFO Med markets are oversupplied and sluggish, with cargoes to NWE starting to become more attractive. For the LSFO there are some cargoes seen moved from NWE to the Med, although the arbitrage is not considered to be open yet. The NWE LSFO markets are also still well supplied, with stored product entering the market and product arriving out of the US. The continuing cold weather however is lending some support.

Indications for delivered bunkers:

380cst: $488
(1.5%): $508
180cst: $502
(1.5%): $523 (very low avails)
DMB: N/A
MGO 0.1%S: $769