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PVM Midday Report 13 August 2015

Published Thursday, August 13th, 2015

Headlines

  1. Iraq set to export 3.017 mbpd of Basra crude in September, up from 2.52 mbpd in August
  2. PBOC lowers renminbi peg for third straight day but by less-than-expected
  3. Greek 2Q GDP growth surprises at +0.8%; surpasses expectations of -0.5%
  4. French EU-harmonised annual inflation rate eases in July to 0.2%; Germany steady at 0.1%

Oil                                                                                              

Fundamentals: Iraq is set to export 3.107 mbpd of its Basra crude grade in September, an increase over the 2.52 mbpd planned this month with the rise coming almost entirely from an uptick in its sales of the heavier Basra Heavy grade. Meanwhile, WTI spreads at the front end of the curve are weakening further due to the uncertainty surrounding the restart if the US Spearhead pipeline with the second and third month spread slipping 2cts/bbl to its weakest in over four months.

Technicals: WTI is still being pushed back by the 5 day MA around 43.74. It needs to at the least move and close over here to have a hope of higher numbers. The 8 day is around 44.28. Oct’ Brent is holding well over the 5 and 8 and is eyeing up the 13 day around 51.26. It should reach for this important resistance in the near future. Heat is over all the s/t MAs and should head for 163.39. RBOB is also above all the s/t MAs and has a target to 179.73. Gasoil is above the s/t MAs and now needs to close over 486.50 to greenlight an objective to 515.50. The stochastics have moved positive. There is a clear intent to bottom out and move higher, but we need at least 4 out of the 5 contracts to move over all the s/y MAs. The down trend is looking fragile at the moment, but it is early days yet.

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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.