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PVM Midday Report 15 July 2015

Published Wednesday, July 15th, 2015

Headlines

  1. Chinese implied oil demand jumps 3.5% in June y/y to 10.56 mbpd
  2. Sources claim Iran’s state-oil company ordered to ramp up output from oil fields
  3. Syriza rebellion sees deputy finance minister resign in protest at bailout measures
  4. UK jobless rate in first rise for two years from 5.5% to 5.6% in the three months to May
  5. EU Commission controversially proposes use of EFSM for Greek bridge loan

Oil                                                                                              

Fundamentals: Hot on the heels of Iran’s landmark nuclear agreement, a senior Iranian oil official has claimed that the state-owed oil company has been ordered to increase output from all existing oil fields with the aim of reaching pre-sanction levels of 4 mbpd. Calculations compiled by Reuters have estimated that Chinese implied oil demand increased by 3.5% in June from a year ago to 10.56 mbpd and comes after the world’s second biggest-economy announced 2Q GDP growth was unchanged from the previous quarter at a six-year low of 7%.

Technicals: The rally in the latter part of the previous session has petered out and the contracts have resumed their downward slide. WTI, Gasoil and Sep’ Brent are around their 8-day MAs at 52.51, 531.50 and 58.10 respectively, a close below which will have them greenlight further downside targets. Heat is well off its 5 and 8 day at 172.93/27 and as such looks to be testing 167.21/17 range support. The likelihood of this and general further weakness across the board will come if RBOB can manage a move and close below it key support at 191.83 (100-day MA).

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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.