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PVM Midday Report 06 May 2015

Published Wednesday, May 6th, 2015

Headlines

  1. Abu Dhabi’s NOC retroactively raises April OSP of its crude grades to Asian buyers
  2. Iran’s Supreme Leader warns nuclear talks will not take place under any military threats
  3. API forecasts first 2015-fall in US commercial crude oil stocks
  4. Greece makes €200 million loan repayment to IMF; jobless rate dips to 25.4% in February
  5. Eurozone April Services PMI beats expectations at 54.1

Oil                                                                                              

Fundamentals: Iran’s Supreme Leader has stated that it would not take part in nuclear talks with western powers under the shadow of threats, military or otherwise, with both sides still working towards a final deal by the June 30 deadline. Abu Dhabi’s national oil company has retroactively raised the April OSP of its crude to Asia in what is seen as a further sign of robust global oil demand. Meanwhile, the API has forecast that US commercial crude oil stocks drew 1.5 million bbls in the latest week in what would be the first draw in 17 weeks.

Technicals: The trend is up. It is not advised to play against it. Dips to the 5 or 8 day MAs should be seen as buying opportunities. There are target higher to 62.03 WTI – hit today and if closed over the next one is to 64.24; Brent to 72.13, valid if above 67.79; Heat to 207.84, valid whilst above 203.75; RBOB to 215.37, valid whilst above 206.18; and Gasoil to 623.75 – hit this morning and on a move and close over to 641.00. The stochastics are positive and a bit high. It’s advised to run length to the targets. The longer term view is that the market has some way to go higher yet and playing alongside the trend is recommended.

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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.