Technical & Fundamental Oil Reports Specialists

Follow us

Everyone has a mandate

Published Friday, February 6th, 2015

Three significant up days were followed by a big down day and then yesterday by a rally that clawed back 45% (WTI) and 65% (Brent) of Wednesday’s losses. The message is that the ground is very slippery underfoot and next week we could find crude, basis Brent, challenging support at $50 bbl or resistance at $60 bbl.

There was no price changing oil news to justify yesterday’s rally so it should be treated with caution from a fundamental point of view. Short-term fundamentals are very clear. There is a huge excess of oil and a lot of it is being taken into storage as evidenced by US crude stock levels at their highest ever. Total US commercial and strategic stocks stand at 1.87 billion bbls which represents 100 days of demand cover.

The battle for Asian market share continues with Saudi Arabia cutting the price of Arab Light for March delivery to the region from Oman/Dubai -$1.40 bbl to -$2.30 bbl which is the biggest discount in more than a decade. Arab Medium was cut by 80cts bbl to O/D -3.60 and Arab Heavy by 40cts bbl to O/D -5.55.

to read the rest of the report, please click here

Posted by David Hufton