A sustained move under $53.61 will signal the use of sellers which indicates a bull trap. This will likely trigger a labored break with potential targets coming in at $52.40, $51.29 and $50.66. If $50.66 fails as support then look for the supplying extend in the main retracement zone at $50.28 to $48.83.
A sustained move over $54.00 will indicate the use of buyers. This may also indicate that Friday’s move was fueled by fake buying rather and buy stops. The upside momentum will not continue and testing $54.98 is often a pipe dream for buyers from fuelled trade talks.
Lifting Iranian sanctions will have a significant influence on the planet oil market. Iran’s oil reserves will be the fourth largest on earth and they have a production capacity of approximately 4 million barrels every day, causing them to be the second biggest producer in OPEC. Iran’s oil reserves account for approximately 10% with the world’s total proven petroleum reserves, at the rate with the 2006 production the reserves in Iran could last 98 years. More than likely Iran will prove to add about 1 million barrels of oil per day to the market and in accordance with the world bank this will likely resulted in lowering of the oil price by $10 per barrel next season.
Based on Data from OPEC, at the start of 2013 the largest oil deposits are in Venezuela being 20% of worldwide oil reserves, Saudi Arabia 18%, Canada 13% and Iran 9%. As a result of characteristics from the reserves it’s not at all always simple to bring this oil for the surface in the limitation on extraction technologies as well as the cost to extract.
As China’s increased demand for gas main as an alternative to fossil fuel further reduces overall requirement for oil, the increase in supply from Iran and also the continuation Saudi Arabia putting more oil on top of the market should see the price drop over the next 1 year and some analysts are predicting prices will fall into the $30’s.
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