PVM Midday Report 13 June 2016
Headlines
OPEC hints at tighter oil balance in 2H 2016; output down 100,000 bpd in May
Chinese implied oil demand falls by 380,000 bpd in May y/y to 10.24 mbpd
Iran’s biggest oil…
Headlines
- Niger Delta Avengers claim responsibility for fresh oil attacks
- US recoverable oil reserves exceed those in Saudi Arabia and Russia – Rystad
- Caixin/Markit Chinese services PMI rises to 11-month high of 52.7 in June
- Eurozone services PMI slips to 17-month low of 52.8 in June
- BoE reduces banks’ capital buffer restrictions in bid to boost liquidity
Oil
Fundamentals: The militant group responsible for a spate of attacks on oil facilities in Nigeria’s delta region have claimed responsibility for two separate attacks carried out late last night against the state-owned oil company and a western oil major. Elsewhere, a report has revealed that the outstanding reserves of recoverable crude oil in the US is estimated at 264 billion bbls – more than those in Saudi Arabia and Russia which are thought to stand at 256 billion bbls and 212 billion bbls respectively.
Technicals: The market is in trouble and the move below the short-term MAs has greenlighted a “trapdoor” move to the 55s in most cases. These 55s are on WTI at 47.90 and 47.07 WTI; Brent 49.10 and 48.46; Heat 145.31 then 143.75; and Gasoil 430.75 then 429.25. A move below the higher green lights a modest leg south to the lower 55, but a m/c below that would be bearish and activate targets lower. RBOB gave the signal for weakness and has failed to hold the 100/200 combo at 148.70/38, but is above the c/p at 145.95. The daily and weekly stochastics are negative. The contracts are completing a price cycle lower at the 55s – be careful there, but sell m/cs below.
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