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PVM Midday Report 20 August 2015

Published Thursday, August 20th, 2015

Headlines

  1. Nigeria to export 368,000 bpd of Qua Iboe crude in Oct; up from 348,000 bpd in Sep
  2. Mexico guarantees 2016 average oil price of $49/bbl in annual hedging programme
  3. Chinese crude oil imports up 7.5% y/y to 163.3 million tonnes in the first half of 2015
  4. Greece receives first tranche from latest bailout; makes €2.3 bln ECB bond repayment

Oil                                                                                              

Fundamentals: Mexico has revealed details of its annual oil hedging programme in which it guaranteed an average crude oil price of $49/bbl for next year at a cost of over $1 billion and covers more than 200 million bbls. Nigerian exports of Qua Iboe crude oil have been set at 368,000 bpd for October, an increase from the 348,000 bpd planned for September. Meanwhile, figures have shown that Chinese crude oil imports rose by 7.5% to 161.3 million tons in the first half of 2015 over the same period last year as Beijing took advantage of low prices to increase strategic oil fills.

Technicals: The price carnage continues. The trend is relentlessly down. There are targets lower on Oct’ WTO to 39.99; Brent to 45.12; Heat to 148.71; RBOB to 150.81; and Gasoil to 453.75. Shorts should be run to here and re-set on moves confirmed by closes below these levels. The key technical indicators support this move lower. It is not advised to be long.

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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.