Technical & Fundamental Oil Reports Specialists

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PVM Midday Report 07 December 2015

Published Monday, December 7th, 2015

Headlines

  1. Speculators trim bets on rising ICE Brent crude prices by more than 4% in week to Dec 1
  2. Saudi Aramco CEO hints decline in tight oil supplies will help stabilise prices in 2016
  3. German industrial output climbs 0.2% in October; ends two straight months of declines
  4. Latest Sentix survey of eurozone economic morale jumps to four-month high

Oil                                                                                              

Fundamentals: The CEO of Saudi Arabia’s state-owed oil giant Saudi Aramco has hinted that next year’s expected decline in the supply of unconventional oil will hopefully lead to an upward adjustment in oil prices. In the meantime, the short-term oil price outlook continues to remain downbeat with speculators paring bets of rising WTI and Brent crude prices. Net speculative length (NSL) in ICE Brent was trimmed by 7,549 lots to 170,396 contracts in the week to December 1 and comes as NSL in combined NYMEX and ICE WTI fell to its lowest since July 2010 over the same period.

Technicals: The downtrend has bedded in and the move lower is unrelenting. The contracts have dipped in unison and have downside targets to 38.99 WTI; 42.23 Brent; 130.33 Heat; 124.84 RBOB and 383.75 Gasoil. Run shorts to these levels and take profit on move and closes below them before resetting short positions. Stick with the trend and do not 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.