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PVM Midday Report 21 December 2015

Published Monday, December 21st, 2015

  1. Iraqi crude oil exports on course to hit record daily average in December
  2. Iranian crude oil exports to China surge by 45% in November on the month to 491,100 bpd
  3. Speculators trim bets on rising ICE Brent crude prices by almost 6% in week to Dec 15
  4. Germany’s Bundesbank warns of continued downbeat industrial activity in 1Q next year

Oil                                                                                              

Fundamentals: Chinese imports of Iranian crude oil surged by 45% to 491,100 bpd in November compared with October and comes as Russia reclaimed the position of top crude supplier to China for the third time this year at the expense of Saudi Arabia. Staying with OPEC’s de facto leader, official data has revealed that Saudi crude oil exports rose by 253,000 bpd in October from September to 7.364 mbpd. Iraqi crude oil exports have also continued apace and are on course to hit a record average daily high this month after so far averaging 3.45 mbpd in December. Meanwhile, speculators have pared back bets on rising ICE Brent crude prices in the week to December 15 by 10,874 lots to 171,834 contracts.

Technicals: The contracts have lost further value this morning as RBOB joins the rest in slipping below all of its s/t MAs. The crudes continue to provide guidance and have tested downside targets at 34.53 WTI and 36.20 Brent – a m/c below would be bearish and a sell. Lower numbers are on the cards and rallies to the 5s and 8s remain good selling opportunities. Stick with the trend. 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.