A sustained move under $53.61 will signal the existence of sellers revealing a bull trap. This will likely 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 into the main retracement zone at $50.28 to $48.83.
A sustained make room $54.00 will indicate the use of buyers. This can 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 can be a pipe dream for buyers from fuelled trade talks.
Lifting Iranian sanctions will have a significant effect on the globe oil market. Iran’s oil reserves will be the fourth largest on the planet and they’ve a production capacity of around 4 million barrels per day, causing them to be the second largest producer in OPEC. Iran’s oil reserves are the cause of approximately 10% with the world’s total proven petroleum reserves, in the rate in the 2006 production the reserves in Iran could last 98 years. Most likely Iran will add about A million barrels of oil per day for the market and in line with the world bank this will resulted in the lowering of the oil price by $10 per barrel pick up.
As outlined by Data from OPEC, at the outset of 2013 the largest oil deposits are in Venezuela being 20% of global oil reserves, Saudi Arabia 18%, Canada 13% and Iran 9%. Because of the characteristics in the reserves it isn’t always possible to bring this oil for the surface in the limitation on extraction technologies as well as the cost to extract.
As China’s increased need for propane rather than fossil fuel further reduces overall demand for oil, the rise in supply from Iran and also the continuation Saudi Arabia putting more oil on top of the market should understand the price drop within the next Twelve months plus some analysts are predicting prices will fall under the $30’s.
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