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PVM Midday Report 08 April 2015

Published Wednesday, April 8th, 2015

Headlines

  1. Crude exports from Russia’s Black Sea ports halted due to adverse weather conditions
  2. Worsening security situation in the Yemen forces closure of production train at LNG plant
  3. Saudi oil production steady at record high of 10.30 mbpd
  4. US mortgage applications index inches 0.4% higher in week to April 3
  5. German industrial orders suffer second straight monthly decline in February

Oil                                                                                              

Fundamentals: Oil prices are on the back foot as news that Saudi oil production is stable at a record high of 10.30 mbpd reverberates across energy markets. The halting of crude oil exports from Russia’s Black Sea ports following a storm is offering little support to the complex as is the shutdown of a production train at Yemen’s main LNG export plant due to the worsening security situation. Meanwhile, Iranian oil officials have confirmed that they are attempting to resolve their differences with Chinese energy companies regarding much needed investments in its oil and gas industry as it seeks to ready itself for a potential boost in crude exports once sanctions are lifted.

Technicals: The contracts are struggling this morning. They have had a good run up – completed a price cycle at the 34 and 100 day MAs and are now pausing for breath. The key resistance pivots are strong and hazardous and are at 54.19 WTI; 59.26 Brent (both continuation 100 day MAs); Heat 178.50 and 179.50 (34 day and c/p); RBOB 183.40 and 184.41 (34 and 100 day); Gasoil 545.00 (34 day). These are levels to be very careful at and there is no upside whilst below them. Meanwhile the stochastics are positive and the s/t MAs are below the market as initial support. It’s advised to wait for developments.

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Posted by Stephen Brennock

Stephen Brennock joined PVM in 2013 after having worked as a project manager for a business development firm. He graduated with a degree in Business Management in 2007.