A sustained move under $53.61 will signal a good sellers revealing 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 to the main retracement zone at $50.28 to $48.83.
A sustained move over $54.00 will indicate a good buyers. This will also indicate that Friday’s move was fueled by fake buying rather and buy stops. The upside momentum will not likely continue and testing $54.98 can be a fantasy for buyers from fuelled trade talks.
Lifting Iranian sanctions may significant affect the globe oil market. Iran’s oil reserves will be the fourth largest in the world and they have a production capacity of approximately 4 million barrels per day, making them the second biggest producer in OPEC. Iran’s oil reserves are the cause of approximately 10% of the world’s total proven petroleum reserves, with the rate with the 2006 production the reserves in Iran could last 98 years. Probably Iran will prove to add about A million barrels of oil a day to the market and in accordance with the world bank this can lead to the lowering of the oil price by $10 per barrel next season.
According to Data from OPEC, at the start of 2013 the biggest oil deposits come in Venezuela being 20% of worldwide oil reserves, Saudi Arabia 18%, Canada 13% and Iran 9%. Due to characteristics with the reserves it’s not at all always easy to bring this oil for the surface because of the limitation on extraction technologies as well as the cost to extract.
As China’s increased demand for propane as an option to fossil fuel further reduces overall demand for oil, the rise in supply from Iran as well as the continuation Saudi Arabia putting more oil onto the market should start to see the price drop in the next 1 year plus some analysts are predicting prices will fall under the $30’s.
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