London (Platts)--16Jul2009

Global crude futures traded slightly lower in the European morning
session Thursday, with lower equity markets and the stronger dollar seen as
the main drivers behind the dip.

At 11:32 BST (1032 GMT), the August ICE Brent contract, on its final
trading day, traded at $62.20/barrel - a $0.89/b fall. The August-September
spread traded lower at minus $0.57, a $0.14 overnight move, while the
September-October spread was also weaker trading at minus $0.62 - a $0.12
fall.

The NYMEX WTI contract was also susceptible to the downward pressure
trading at $60.97/b - a $0.57/b fall. The ICE dollar index traded at 79.395
points, a 0.079 overnight rise.

Crude fundamentals were boosted Thursday following the release of the
China's Q2 economic results. The country's economy grew 7.9% in the quarter,
said the government, in a stunning turnaround for the Asian powerhouse that
offered some hope for the rest of the world, reported AFP.

"Chinese economic growth should certainly provide some fundamental
support," a London-based broker said. This view was echoed by energy analyst
Olivier Jakob who said: "In the oil markets as in the economy one needs to
look East not West," adding that the Chinese crude oil runs were 650 million
b/day higher than a year ago.

However, other sources were more despondent about the fundamental
backdrop for the oil market.

"I'm surprised crude prices are holding with product cracks at really low
levels and the amount of crude on floating storage," a broker said.

According to market sources, floating storage in the North Sea is
currently estimated at 16 million barrels. Product cracks meanwhile continued
to remain depressed with the middle part of the barrel underperforming.

"It won't be long until oil fundamentals take a hold of the market," the
source added.

Insight into the overall health of the banking sector will continue this
week as JP Morgan announces its Q2 financial results later Thursday, while
Citi and Bank of America's are scheduled to publish their quarterly results
Friday.
--George Johnson, george_johnson@platts.com