A sustained move under $53.61 will signal the presence of sellers which indicates a bull trap. This may trigger a labored break with potential targets weighing $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 a good buyers. This will likely also indicate that Friday’s move was fueled by fake buying rather and merely buy stops. The upside momentum will not likely continue and testing $54.98 is really a pipe dream for buyers from fuelled trade talks.
Lifting Iranian sanctions have a significant affect the globe oil market. Iran’s oil reserves include the fourth largest on earth with a production capacity of about 4 million barrels each day, driving them to the second largest producer in OPEC. Iran’s oil reserves are the cause of approximately 10% of the world’s total proven petroleum reserves, at the rate of the 2006 production the reserves in Iran could last 98 years. Almost certainly Iran will prove to add about A million barrels of oil per day to the market and according to the world bank this will resulted in cut in the oil price by $10 per barrel the coming year.
According to Data from OPEC, at the start of 2013 the most important oil deposits come in Venezuela being 20% of global oil reserves, Saudi Arabia 18%, Canada 13% and Iran 9%. Because of the characteristics from the reserves it is not always possible to bring this oil to the surface given the limitation on extraction technologies and the cost to extract.
As China’s increased demand for gas instead of fossil fuel further reduces overall requirement for oil, the rise in supply from Iran and also the continuation Saudi Arabia putting more oil onto the market should understand the price drop in the next Twelve months and some analysts are predicting prices will fall into the $30’s.
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