A sustained move under $53.61 will signal the existence of sellers revealing a bull trap. This will 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 selling to extend in the main retracement zone at $50.28 to $48.83.
A sustained make room $54.00 will indicate the existence of buyers. This can also indicate that Friday’s move was fueled by fake buying rather and simply buy stops. The upside momentum will not continue and testing $54.98 is really a fantasy for buyers from fuelled trade talks.
Lifting Iranian sanctions may significant impact on the world oil market. Iran’s oil reserves will be the fourth largest on earth and they have a production capacity of around 4 million barrels every day, causing them to be the second largest producer in OPEC. Iran’s oil reserves take into account approximately 10% from the world’s total proven petroleum reserves, at the rate of the 2006 production the reserves in Iran could last 98 years. Most likely Iran create about One million barrels of oil a day towards the market and in line with the world bank this may resulted in the lowering of the crude oil price by $10 per barrel next season.
According to Data from OPEC, at the start of 2013 the biggest oil deposits are in Venezuela being 20% of world oil reserves, Saudi Arabia 18%, Canada 13% and Iran 9%. As a result of characteristics from the reserves it’s not at all always easy to bring this oil towards the surface in the limitation on extraction technologies along with the cost to extract.
As China’s increased requirement for gas instead of fossil fuel further reduces overall interest in oil, the rise in supply from Iran and 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 into the $30’s.
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