By Walter de Wet After yesterday’s DOE inventory report, combined with the broad-based commodity sell-off, crude oil prices remain under pressure. Our initial target was for front-month prices to fall to $75-$77. While we are now within this range, we see too much uncertainty in the broader financial market to rule out further weakness. Headline figures in the DOE inventory report showed crude oil stockpiles declining marginally by 417K bbls, while gasoline inventories were up 3,95m bbls. While distillate inventories finally showed a decline (falling by 3.2m bbls) one can hardly read it as bullish. But for the distillates inventory draw, it was a case of to little too late. Distillate inventories remain very high, and the cold weather is easing. As a result, crude oil prices cannot be expected to benefit from the distillate drawdown. WTI front-month price support is at $76.0 0and $75.20, resistance is at $77.75 and $79.40. Thermal coal prices came under further pressure yesterday on the back of a weaker energy complex. But the sell-off remains muted compare to what we saw elsewhere. API2 for delivery in January closed at $82.75, down $1.75. While coal prices may ease with crude under pressure, we do not anticipate major slide, as there seems to be good demand from China on the back of supply problems to power stations.

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