A sustained move under $53.61 will signal the presence of sellers which indicates a bull trap. This can 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 selling to extend to the main retracement zone at $50.28 to $48.83.
A sustained move over $54.00 will indicate the existence of buyers. This will likely also indicate that Friday’s move was fueled by fake buying rather and merely buy stops. The upside momentum won’t continue and testing $54.98 is often a pipe dream for buyers from fuelled trade talks.
Lifting Iranian sanctions will have a significant influence on the planet oil market. Iran’s oil reserves would be the fourth largest on earth and they have a production capacity of about 4 million barrels per day, driving them to the second biggest producer in OPEC. Iran’s oil reserves account for approximately 10% with the world’s total proven petroleum reserves, with the rate in the 2006 production the reserves in Iran could last 98 years. Almost certainly Iran will prove to add about 2million barrels of oil a day to the market and in accordance with the world bank this will likely lead to the cut in the oil price by $10 per barrel the coming year.
As outlined by Data from OPEC, at the outset of 2013 the most important oil deposits are in Venezuela being 20% of world oil reserves, Saudi Arabia 18%, Canada 13% and Iran 9%. Because of the characteristics with the reserves it’s not always easy to bring this oil towards the surface in the limitation on extraction technologies as well as the cost to extract.
As China’s increased interest in natural gas as an option to fossil fuel further reduces overall need for oil, the increase in supply from Iran and the continuation Saudi Arabia putting more oil on the market should see the price drop on the next Twelve months plus some analysts are predicting prices will belong to the $30’s.
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