On Monday, crude oil futures dropped sharply against the backdrop of the withdrawal of profits traders after the prices of new record peaks.
At the NYMEX was Wednesday November futures fell to $ 1.26 to $ 53.67 a barrel. During the day, futures reached $ 55.33, but the level was unviable, which has prompted market participants to fix profits.
At the IPE in London, the November "Brent" fell $ 1.02 to $ 48.91 a barrel.
Falling prices helped to lower the message OPEC forecast world oil demand in 2005.
According to OPEC demand forecast for 2005 to decline by 130,000 barrels per day to 1.61 million barrels. However, world demand has been raised in the fourth quarter of this year. It was expected that demand will grow by 110,000 barrels per day to 2.6 million barrels. In September, OPEC increased oil production to 430,000 barrels per day to 30.12 million barrels a day.
Earnings shot short, only two incomplete trading session. On Tuesday at the European and electronic bidding, against the backdrop of news about the resumption of oil supplies from the terminal in Louisiana, the decline in oil prices has continued. OIL TERMINAL LOOP (Louisiana Offshore Oil Port) resumed full-scale pumping of oil in the onshore storage facility after the reduction of supply by 25 per cent has been damage caused by Hurricane Ivan.
Oil production in the Gulf of Mexico, I can say is restored and the disruption of supply from this part is no longer in sight, because hurricane season, which lasts from June to November 1, came to an end.
But the market had expected output data for U.S. stocks on Wednesday and one hour before the end of the trading, oil prices went up and did not manage to consolidate below $ 52.00 a barrel.
According to statistics EIA, commercial oil stocks rose by 1.2 million barrels for the week ending 15 October and reached a level of 279.4 million barrels, which at 10.9 million barrels higher than a year ago.
Inventories of gasoline fell by 700,000 barrels to 199.9 million barrels, which at 4.2 million barrels higher than in the same period a year ago.
However, gasoline is now few people are interested. Approaching winter, forcing more and more to pay attention to heating oil (fuel oil), which is part of the distillation products. According to the U.S. Department of Energy distiller stocks fell for the week ending October 15, at 1.9 million barrels to 119.0 million barrels. Compared with last year, the level was at 12.6 million lower. In particular, stocks of diesel fuel fell by 900,000 barrels to 67.3 million barrels and heating oil stocks fell by 500,000 barrels to 49.5 million barrels. The level of reserves was a key winter product for 6.9 million barrels lower than in the same period a year ago.
As a result, futures prices for heating oil with delivery in November, seeking to NYMEX, set a new record, reaching the level of Wednesday $ 1.5604 per gallon at the close. Higher prices for heating oil pulled for each other and the price of oil. As a result of the November futures on the sorts of WTI crude oil rose by $ 1.63 to $ 54.92 a barrel. At the end of trading session of the November deadline for the crude oil futures expired. December also jumped to $ 1.77 to $ 54.41 a barrel.
Week took place under the influence of a stronger than expected, reducing the stock of products for the distillation of the week ending October 15. This was the fifth consecutive weekly decline distiller on Friday December futures on WTI crude oil varieties set new maximum of $ 55.50 and completed the week at $ 55.17 a barrel.
At the IPE in London, the December "Brent" has reached a new maximum of $ 51.65 and concluded the week at $ 51.22 a barrel.
What awaits us this week?
On Friday 22 October after closing trades the New York Mercantile Exchange NYMEX announced margin increasing oil futures next four months supply of 17%. The increase in margins will occur on Sunday, October 24, before the start of electronic trading. I recall that on 14 October collateral needed to maintain open positions in oil futures class WTI, has already been raised by 20%. This resulted in a reduction of long positions at the beginning of last week.
Pay attention to the daily schedule for the December futures on crude oil grades WTI. MACD Histogram left in the negative zone, the line also turned down. We have something similar to a triple divergence.
Open Interest Indicator signals a strong reduction of long positions, and all this is happening against the backdrop of falling volumes.
Increase in security deposit for another 17% will lead to mass closures of long positions at the electronic auction. Small speculators are driven from the market and future direction will dictate the large commodity funds, which, incidentally, will also not against the record profits.
As a result, by the end of the day on Tuesday the price of oil could reach the level of $ 52.00 per barrel. Further direction of movement will be determined by statistical data on EIA oil and products in the U.S., falling on Wednesday 27 October.
In this respect, too, can make some assumptions. As reported in the weekly EIA report on 20 October, the rate of capacity utilization by American oil refineries in the week ended Oct. 15 rose by 1.3% to 88.2%. However, some plants reduce the production of fuel oil. However, the level of imports of distiller increased to 344,000 barrels per day. For the week ending October 8, the import of products run on the level was 326,000 barrels per day. The level of oil imports to the U.S. increased by 43,000 barrels and the average was at 10.1 million barrels a day. It was noted that a particularly high oil imports from Mexico.
Capacity utilization refinery is already a month is below 90%. Reduce the load factor has contributed to a powerful blow of Hurricane Ivan in mid-September to the oil and refining industry in the U.S. Gulf of Mexico. At the level of capacity utilization also have put pressure seasonal preventive work carried out usually in September. However, some refineries to carry out work associated with the transition to the production of fuel oil as the primary product production in the winter, in early October. According to the U.S. Department of Energy, refiners have already returned to normal operation.
In this regard, over stated, it can be assumed that on Wednesday October 27, statistics on oil reserves in the U.S. will show not only the continued growth of oil reserves, but also the growth of stocks of products of distillation. In this case, likely to be continued reduction in oil futures quotations by Friday and the December futures prices could reach a level of $ 50.00 per barrel. Generally, oil fly during the week 500 points down is worthless, especially against the background of the "bear" factor.
I recommend selling the December futures for WTI crude oil varieties immediately after the opening of tenders on NYMEX. Those who have access to electronic trading NYMEX ACCESS, can sell at the beginning of the trading terminal.
Stop a better place above $ 56.00 a barrel. However, with developments on the scenario described above, on Tuesday evening, the foot should be moved to bezubytok or to lower levels. Now difficult to determine. Estimated goal - $ 50.00 per barrel, but everything will depend on the EIA data on Wednesday.
At the NYMEX was Wednesday November futures fell to $ 1.26 to $ 53.67 a barrel. During the day, futures reached $ 55.33, but the level was unviable, which has prompted market participants to fix profits.
At the IPE in London, the November "Brent" fell $ 1.02 to $ 48.91 a barrel.
Falling prices helped to lower the message OPEC forecast world oil demand in 2005.
According to OPEC demand forecast for 2005 to decline by 130,000 barrels per day to 1.61 million barrels. However, world demand has been raised in the fourth quarter of this year. It was expected that demand will grow by 110,000 barrels per day to 2.6 million barrels. In September, OPEC increased oil production to 430,000 barrels per day to 30.12 million barrels a day.
Earnings shot short, only two incomplete trading session. On Tuesday at the European and electronic bidding, against the backdrop of news about the resumption of oil supplies from the terminal in Louisiana, the decline in oil prices has continued. OIL TERMINAL LOOP (Louisiana Offshore Oil Port) resumed full-scale pumping of oil in the onshore storage facility after the reduction of supply by 25 per cent has been damage caused by Hurricane Ivan.
Oil production in the Gulf of Mexico, I can say is restored and the disruption of supply from this part is no longer in sight, because hurricane season, which lasts from June to November 1, came to an end.
But the market had expected output data for U.S. stocks on Wednesday and one hour before the end of the trading, oil prices went up and did not manage to consolidate below $ 52.00 a barrel.
According to statistics EIA, commercial oil stocks rose by 1.2 million barrels for the week ending 15 October and reached a level of 279.4 million barrels, which at 10.9 million barrels higher than a year ago.
Inventories of gasoline fell by 700,000 barrels to 199.9 million barrels, which at 4.2 million barrels higher than in the same period a year ago.
However, gasoline is now few people are interested. Approaching winter, forcing more and more to pay attention to heating oil (fuel oil), which is part of the distillation products. According to the U.S. Department of Energy distiller stocks fell for the week ending October 15, at 1.9 million barrels to 119.0 million barrels. Compared with last year, the level was at 12.6 million lower. In particular, stocks of diesel fuel fell by 900,000 barrels to 67.3 million barrels and heating oil stocks fell by 500,000 barrels to 49.5 million barrels. The level of reserves was a key winter product for 6.9 million barrels lower than in the same period a year ago.
As a result, futures prices for heating oil with delivery in November, seeking to NYMEX, set a new record, reaching the level of Wednesday $ 1.5604 per gallon at the close. Higher prices for heating oil pulled for each other and the price of oil. As a result of the November futures on the sorts of WTI crude oil rose by $ 1.63 to $ 54.92 a barrel. At the end of trading session of the November deadline for the crude oil futures expired. December also jumped to $ 1.77 to $ 54.41 a barrel.
Week took place under the influence of a stronger than expected, reducing the stock of products for the distillation of the week ending October 15. This was the fifth consecutive weekly decline distiller on Friday December futures on WTI crude oil varieties set new maximum of $ 55.50 and completed the week at $ 55.17 a barrel.At the IPE in London, the December "Brent" has reached a new maximum of $ 51.65 and concluded the week at $ 51.22 a barrel.
What awaits us this week?
On Friday 22 October after closing trades the New York Mercantile Exchange NYMEX announced margin increasing oil futures next four months supply of 17%. The increase in margins will occur on Sunday, October 24, before the start of electronic trading. I recall that on 14 October collateral needed to maintain open positions in oil futures class WTI, has already been raised by 20%. This resulted in a reduction of long positions at the beginning of last week.
Pay attention to the daily schedule for the December futures on crude oil grades WTI. MACD Histogram left in the negative zone, the line also turned down. We have something similar to a triple divergence.
Open Interest Indicator signals a strong reduction of long positions, and all this is happening against the backdrop of falling volumes.
Increase in security deposit for another 17% will lead to mass closures of long positions at the electronic auction. Small speculators are driven from the market and future direction will dictate the large commodity funds, which, incidentally, will also not against the record profits.
As a result, by the end of the day on Tuesday the price of oil could reach the level of $ 52.00 per barrel. Further direction of movement will be determined by statistical data on EIA oil and products in the U.S., falling on Wednesday 27 October.
In this respect, too, can make some assumptions. As reported in the weekly EIA report on 20 October, the rate of capacity utilization by American oil refineries in the week ended Oct. 15 rose by 1.3% to 88.2%. However, some plants reduce the production of fuel oil. However, the level of imports of distiller increased to 344,000 barrels per day. For the week ending October 8, the import of products run on the level was 326,000 barrels per day. The level of oil imports to the U.S. increased by 43,000 barrels and the average was at 10.1 million barrels a day. It was noted that a particularly high oil imports from Mexico.
Capacity utilization refinery is already a month is below 90%. Reduce the load factor has contributed to a powerful blow of Hurricane Ivan in mid-September to the oil and refining industry in the U.S. Gulf of Mexico. At the level of capacity utilization also have put pressure seasonal preventive work carried out usually in September. However, some refineries to carry out work associated with the transition to the production of fuel oil as the primary product production in the winter, in early October. According to the U.S. Department of Energy, refiners have already returned to normal operation.
In this regard, over stated, it can be assumed that on Wednesday October 27, statistics on oil reserves in the U.S. will show not only the continued growth of oil reserves, but also the growth of stocks of products of distillation. In this case, likely to be continued reduction in oil futures quotations by Friday and the December futures prices could reach a level of $ 50.00 per barrel. Generally, oil fly during the week 500 points down is worthless, especially against the background of the "bear" factor.
I recommend selling the December futures for WTI crude oil varieties immediately after the opening of tenders on NYMEX. Those who have access to electronic trading NYMEX ACCESS, can sell at the beginning of the trading terminal.
Stop a better place above $ 56.00 a barrel. However, with developments on the scenario described above, on Tuesday evening, the foot should be moved to bezubytok or to lower levels. Now difficult to determine. Estimated goal - $ 50.00 per barrel, but everything will depend on the EIA data on Wednesday.
Alexander Fighters
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