What's Moving the Oil Markets?

•Brent crude futures strengthened Tuesday, moving up away from the critical $60/barrel support level which was tested but not broken in Monday's sell-off.

•At 1140 GMT, ICE April Brent futures traded at $61.44/b, up 90 cents from Monday's close. On Monday, April ICE Brent futures went as low as $60/b before rebounding and settling at $60.54/b.

•"Yesterday was an awkward day--funds were liquidating their positions across all commodities, yet it still settled above $60/b," said a London-based broker. "We are looking for support from gasoline. RBOB needs to get back above $1.90/gallon, otherwise there won't be that much momentum."

•The role of gasoline offering support to crude was evident in levels of open interest in gasoline and crude futures. Oil market analysts Petromatrix said in their daily report that open interest in gasoline had been increasing, while crude oil open interest had fallen. Sources said a draw in gasoline stocks in the US would offer further support, although there were no early estimates of what weekly data due out on Wednesday might reveal.

Updated: 03/06/07