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PVM Midday Report 04 November 2015

Published Wednesday, November 4th, 2015

Headlines

  1. Kuwaiti oil minister claims oil prices have reached their bottom
  2. Industry sources predict solid Asian refining margins in 2016
  3. VW emissions scandal spreads to its petrol-powered cars
  4. Final Eurozone Composite PMI slips to 53.9 in October from 54.0 in September

Oil                                                                                              

Fundamentals: Industry sources have claimed that Asian oil refining margins are set to remain solid in 2016 on expectations of robust gasoline demand from China and India but are unlikely to reach the highs of earlier this year. Kuwait’s oil minister has hinted that he believes that oil prices have bottomed out and reiterated that any oil production cut should not fall solely on OPEC members. Meanwhile, US crude inventories are predicted to have built in what would be the sixth consecutive weekly increase. Stocks at the Cushing delivery were reported down 508,000 bbls on the week by the API.

Technicals: Yesterday’s strength has been maintained this morning but more work is needed to ensure a conclusive move and close over targets higher. RBOB has led to move higher by testing its crucial resistance at 146.04 – a close above which would boost upside momentum across the complex. The rest look encouraging and remain above the s/t MAs but higher numbers will only be ensured on a m/c over 49.18 WTI; 51.33 Brent; 158.29 Heat and 478.25 Gasoil. Any potential dips to the 5-day MAs are good buying opportunities. In the meantime expect further strength while RBOB holds 146.04. It is not advised to be short.

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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.