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Rumours and worries about the euro zone debt crisis made equity and forex markets very volatile during yesterday's session, affecting also oil prices. Better-than-expected US indicators supported the oil complex in the afternoon (industrial output rebounded strongly, while consumer prices fell in October for the first time in four months) and the release of US petroleum inventories (DOE) gave even more bullish momentum at first. When most analysts assessed the data as neutral, investors abandoned their long positions and oil shed its gains soon after, with the exception of WTI crude that was supported at this time of the day by news that Enbridge Inc. and TransCanada have raced forward with new pipeline plans in the fierce battle to unclog a year-long U.S. oil bottleneck, which could quickly end an unprecedented distortion in crude markets. After purchasing ConocoPhillips' stake in the 350,000 barrel-per-day Seaway pipeline, Enbridge and Enterprise Products Partners said they plan to reverse the line's flow to send crude locked up at the Cushing, Oklahoma, oil hub to the Texas coast. While ICE futures settled near intrady lows, the WTI crude contract surged above 102 dollars for a barrel. After oil futures traded higher at the beginning of the European session, they have lost ground in the course of the morning. Futures at ICE have approached their supports, with the Brent even breaching some of its support lines. Impulsions were provided by the retreating euro and weak equities. A warning by the rating agency Fitch that the European debt crisis might also affect US banks, weighed on investors' sentiment. Yesterday's surge of NYMEX C. Oil contracts temporarily narrowed the spread between the WTI Crude and the Brent to less than 9 dollars. In the course of this year, the spread had disproportionately widened, as supply in Europe became scant against the backdrop of the uprisings in the Arab countries and as the central storage place in Cushing, Oklahoma, where crude oil is still traded physically, has a special position. As ConocoPhillips retained well-enough margins given the low prices of WTI Crude in Cushing and the enterprise's control of the pipelines, an unusually high spread between the WTI Crude and other crude varieties developped this summer.

Because of the development against the trend of the WTI crude contract on Wednesday, a technical analysis of the WTI chart is useless today. The Stochastic oscillator at the gasoil chart is bearish and the RSI indicator is set to cross the 70% line which would also trigger a bearish signal. The indicators at the brent chart are without momentum for the time being. The contract fell through its short-term support lines yesterday but managed to hold above the important 110,00 dollar level. So technical analysts see the contract well within its trading range between 110,00 dollars and 112,60 dollars today. Only if the upper or the lower limit of the range are being breached will more technical selling or buying orders be triggered. The WTI is supported at 99,25 dollars today, its first resistance is seen at 102,90 dollars. The Brent's first resistance is seen at 112,50 dollars, its first support is at 110,50 dollars. Oil futures have erased earlier gains during morning trade, dropping to new lows around noon. Since then first supports have been breached at ICE. Only NYMEX C. Oil remained on a higher level. Oil prices again kept track of equities and the euro, both declining on renewed fears regarding the Euro zone's debt crisis, after yields on Spanish 10-year bonds climbed to 6.57 percent. Currently there are no decisive fundamental news. Thus investors eye US economic indicators, published in the afternoon.

Neither the Stochastic oscillator nor the RSI indicator are giving any clear signals this morning and are therefore regarded as neutral. While the WTI's uptrend channel is still strong, a technical triangle has formed at the brent chart and the G.Oil contract has a strong resistance in the 1.000 dollar area. Market participants will eye the release of the DOE data today, so technical analysts. Should the data show unexpected stock builds (bearish), there is a strong possibility that existing support lines were breached. Below these levels more downside would be revealed and the overbought market situation would accelerate the price collapse. The WTI is supported at 98,35 dollars today, its first resistance is seen at 99,85 dollars. The Brent's first resistance is seen at 112,70 dollars, its first support is at 111,00 dollars.

ICE Gasoil contract for December delivery settled at 993,75 dollars on Tuesday. This was 5,50 dollars below Monday's settlement. With some 82.500 contracts the traded volume was well above average.

The objectives of the deal between ConocoPhillips (see early morning news) support the WTI Crude futures. Analysts are yet split, however, over the extent to which the spread between the Brent and the WTI crude prices will narrow and at what pace. Most experts expects the spread to stabilise between 5 and 8 dollars by the end of 2012. The deal is obviously designed to deliver about 150,000 barrels of crude oil from Oklahoma to the Gulf of Mexico in the 2nd quarter of 2012. At the beginning of 2013 the capacity is to be raised to 400,000 barrels per day.

The euro trimmed its losses after hitting five-week lows versus the dollar in Asian trading this morning as bond market turmoil spread across Europe, but market players were still bracing for further weakness in coming weeks. Investors were also nervously watching to see how German financial markets will react after rating agency Moody's Investors Service cut ratings of 12 German public-sector banks, believing they are likely to receive less federal government support if needed. The euro last sold at 1,3497 dollars, after dipping to as low as 1,3421 dollars this morning, its lowest since October 10th. The single currency has support at 1,3415 dollars, 1,34 dollars, 1,3345 dollars and 1,33 dollars. Resistances are at 1,3555 dollars, 1,36 dollars, 1,3645 dollars and 1,37 dollars.

As expected, the euro zone inflation rose 3.0% on year in October after 3.0% in September.

U.S.

Nymex Access gaining: Oil futures regained ground in Asian trading hours and on Globex electronic trading platform this morning, supported by a strongly rising euro and a rebound in Asian equity markets. The traded volume is about on average. Market participants eye the release of more US indicators today.

Survey of the US natural gas storage volumes according to EIA: to be released later today for the week till November 11th: +27,00 bcf (billion cubic feet) vs the previous week.

US Petroleum inventories: the data show a draw in US crude stocks and distillates which is about in line with expectations while gasoline stocks unexpectedly rose and refineries ramped up production.

After a first bullish reaction oil prices shed earlier gains when analysts assessed the data as rather neutral. The draw in crude stocks is a result of the ramp up in production of US refiners who have widely finished maintenance and repair works. Gasoline stocks rose due to a drop in demand and distillate inventories fell on rising demand for heating oil ahead of the winter season and a modest increase in exports.

Houston (ex-wharf indications 17-11)

380cst $660
180cst $710
MGO $1005

Very tight avails for 180 cst

New Orleans (ex-wharf indications 17-11)

380cst $663
180cst $713
MGO $1010

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

Crude's is surging with WTI +$3.99. Singapore paper is ignoring this with -$11.15 for 180cst and -$9.85 for 380cst for Dec, and for Jan 180 cst -$11.15 and 380cst -$9.45 with MGO Dec contracts at -$0.83 and for Jan at -$0.73. The cargo market is following paper now with 180cst -$2.93, 380cst -$3.37 and MGO -$0.42.

The Singapore fuel oil markets lost more than -$3.0 during the Platts window yesterday. Market remains supported with robust bunker demand yesterday. The delivered bunker premiums were ranging from $14.5 above the cargo prices yesterday.

High premiums for prompt deliveries.

380 cst $688
180 cst $698
MGO $980

Fujairah (delivered indications 17-11)

380cst $698
180cst $730
MGO $1040

Avails issue are sustaining the market.

ARA (Amsterdam - Rotterdam - Antwerp)

Demand in Amsterdam-Rotterdam-Antwerp remained firm on ongoing high sulfur fuel shortages, while trading activity in the rest of Northwest European bunker hubs was weak. HSFO prices in Rotterdam and Antwerp remained largely unchanged on flat FOB Rotterdam barges, that were tracking a relatively flat Brent crude over the day. HSFO and low sulfur fuel oil supplies in Rotterdam for prompt deliveries were very tight on a recent VLCC loading and blending stock tightness, sources said. Prompt there is very little on spec IFO available for HS or LS with more quoting 19 onwards and some only from the 21st. Antwerp is also very short of LSFO as Total and ExxonMobil’s refineries were supplying the raised inland demand for fuel oil due to the heating season starting earlier this month. Tighter fuel oil availability in the port is keeping prices firm.

Rotterdam

Indications for delivered bunkers:

380cst : $ 648
(1.0 %) :$ 676
180cst: $ 671
(1.0 %):$ 704
MGO 0.1%S: $985