A sustained move under $53.61 will signal the presence of sellers which indicates a bull trap. This will likely trigger a labored break with potential targets coming in at $52.40, $51.29 and $50.66. If $50.66 fails as support then look for the selling to extend into the main retracement zone at $50.28 to $48.83.
A sustained make room $54.00 will indicate the presence of buyers. This will likely also indicate that Friday’s move was fueled by fake buying rather and simply buy stops. The upside momentum is not going to continue and testing $54.98 is often a pipe dream for buyers from fuelled trade talks.
Lifting Iranian sanctions have a significant influence on the globe oil market. Iran’s oil reserves will be the fourth largest on the globe with a production capacity of approximately 4 million barrels per day, causing them to be the second biggest producer in OPEC. Iran’s oil reserves account for approximately 10% of the world’s total proven petroleum reserves, on the rate with the 2006 production the reserves in Iran could last 98 years. Most likely Iran include about 1 million barrels of oil each day towards the market and according to the world bank this will likely resulted in the cut in the crude oil price by $10 per barrel next season.
Based on Data from OPEC, at the outset of 2013 the most important oil deposits come in Venezuela being 20% of global oil reserves, Saudi Arabia 18%, Canada 13% and Iran 9%. Due to characteristics of the reserves it isn’t always simple to bring this oil for the surface because of the limitation on extraction technologies and also the cost to extract.
As China’s increased demand for propane as an alternative to fossil fuel further reduces overall requirement for oil, the rise in supply from Iran as well as the continuation Saudi Arabia putting more oil to the market should start to see the price drop over the next 12 months and several analysts are predicting prices will belong to the $30’s.
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