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PVM Midday Report 18 May 2015

Published Monday, May 18th, 2015


  1. Iran deputy Oil Minister says unlikely OPEC will cut output at June 5 meeting
  2. Saudi oil exports hit multi-year peak of 7.898 mbpd in March
  3. Speculators trim net length in ICE Brent by 10,147 lots in week to May 12
  4. Saudi-led air strikes against Houthi rebels resume after five-day humanitarian truce ends
  5. Goldman revises 2015 Brent & WTI forecasts to $58 & $52 bbl, up $6 & $4 respectively


Fundamentals: Iran’s deputy oil minister has stated that OPEC will unlikely cut its 30 mbpd production quota at next month’s meeting and revealed that its own pre-sanction crude export level of 2.5 mbpd should be reachable within 3-6 months of a nuclear deal being finalised. Official data has shown that record crude production in March helped propel Saudi oil exports to a multi-year high of 7.898 mbpd. Staying with Saudi, it has resumed air strikes on Houthi positons in Yemen overnight after a five-day ceasefire expired. Shell’s 180,000 bpd Trans Nigeria pipeline has reopened with flows halted almost a week ago following a leak. Meanwhile, money managers have ended a run of seven straight weeks of increasing length in ICE Brent crude after trimming net long positons by 10,147 lots to 278,580 contracts in the week to May 12.

Technicals: The early morning rapid move up of over a dollar from settlement was always going to be difficult to maintain. The technicals pointed to it being well overdone to the upside, logic prevailed, and the contracts slid back. July WTI participated in the rally but is now back and testing the lowest s/t MA – the 13 around 60.82. It needs to move back over here by the close tonight. Brent failed at the key resistance at 67.85 and is now back testing the 8 day MA around 66.60.

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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.