•Crude futures were steady on Tuesday, poised to hit fresh record highs with momentum remaining bullish across the barrel ahead of the June NYMEX crude contract expiry at the end of trading today.

•Ongoing supply worries surrounding Nigeria were keeping flat crude prices firm despite weakening inter-month spreads and Saudi Arabia's pledge to increase crude supplies from June. Distillates futures, meanwhile, continued to move higher as diesel demand in China is likely to ramp up significantly due to the earthquake relief efforts, sources said.

•"Spreads for ICE Brent continue to weaken but flat prices defy logic and go even higher," a London-based broker said. "Stronger Chinese demand for distillates seems to be the main driver," the broker added. The July/August ICE Brent spread was seen at minus 87 cents/b, down from yesterday's settle spread of minus 62 cents/b.

•"The market is still in overdrive about the likelihood of a surge in Chinese demand for diesel in the aftermath of last weeks earthquake," MF Global's Rob Laughlin said in a comment Tuesday.

Updated: May 20, 2008