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PVM Midday Report 08 July 2016

Published Friday, July 8th, 2016

Headlines

  1. Nigerian oil minister claims its oil output stands at 1.9 mbpd despite recent attacks
  2. Brent’s premium to Dubai slips below $3/bbl to a three-month low
  3. Baker Hughes’ international rig count falls by 28 to 927 in June 2016
  4. German May exports drop 1.8% in steepest monthly fall since August 2015

Oil                                                                                              

Fundamentals: Nigeria’s oil minister has revealed that the country’s oil output currently stands at about 1.9 mbpd and comes in spite of a recent spate of attacks, the latest of which occurred today when part of a pipeline belonging to Italy’s Eni was blown up. The aftershock of the post-US stats oil slump has sent Brent’s premium against the Dubai crude oil benchmark to a three-month low of $2.90/bbl. Meanwhile, Baker Hughes has announced that the number of international rigs in use fell by 28 in June to 927 when compared to May.

Technicals: The market is struggling but not collapsing below key supports this morning. These are at 44.80 WTI; 46.50 Brent; 141.25 Heat; 135.47/33 then 134.82 RBOB; and 410.00 Gasoil. These have very good chance of being re-tested today but there are no further targets south until there are moves confirmed by closes below. This would open the way for softer numbers and start the momentum of a downtrend. In the meantime rallies to resistance and specifically the 5 day MAs are sales. It is not advised to 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.