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
- Norwegian oil service workers fail to agree wage deal with employers
- Brazilian oil and gas output climbs above 3 million boepd in May
- German factory orders unchanged in May, dashes hopes of a 1% m/m increase
- Sweden’s central bank postpones future rate hikes amid Brexit uncertainty
Oil
Fundamentals: The “bear fest” continues and oil is taking its cues from the global rout in risk assets as economic concerns dampen oil demand growth prospects. The rising threat of strike action following the breakdown of wage talks between Norwegian oil service workers and the employers is failing to provide any bullish impetus. Similarly, a Reuters poll pointing to a seventh consecutive weekly drawdown in US commercial oil stocks is having a muted impact on sentiment. Elsewhere, Brazil’s oil and gas production rose by almost 8% on the month in May to 3.12 million boepd.
Technicals: Targets lower are being hit on WTI to 45.83 (nearly hit with a low at 45.96); Brent to 47.30 (hit); Heat 144.08 (hit); RBOB 139.79 (hit); and Gasoil to 418.75 (hit). Moves confirmed by closes below would green light further objectives lower to 44.62 WTI; 48.82 then 45.60 Brent; 143.42 then 141.25 Heat; 134.84 RBOB; and 410.00 Gasoil. The daily and weekly stochastics are negative. The market is shaping to go lower. It is not advised to be long.
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