Crude Oil Weekly Fundamental Analysis July 16-20, 2012, Forecast

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Introduction:  Crude Oil is considered the king of the commodities markets.

The Strategic Petroleum Reserve is the United States’ emergency oil stockpile, and it is the largest emergency petroleum supply in the world. The reserve stores about 570 million barrels of crude oil in underground salt caverns at four sites along the Gulf of Mexico. Any dipping into this reserve is going to be big news.

Brent Crude is traded in London as something called Futures contracts, which are priced in US Dollars. Now, all you traders brave enough to run your positions over a period of days or weeks, pay attention

Most commonly traded is the NYMEX where you find West Texas Crude. It is also traded in USD.

Weekly Analysis and Recommendation:

Crude Oil was able to climb this week on the geopolitical problems in the early part of the week, as the US turned up the heat on Iran, implementing more controls for the embargo.  Crude closed the week at 87.07.

Also, investors on Friday, moved in to the markets in search of more risk, with the Chinese GDP coming in at forecast, investors were able to breathe a sigh of relief. Although the IMF this week is expected to lower global growth forecast. The EIA this week also reduced their crude oil demand forecast for the balance of 2012.

Date

Last

Open

High

Low

Change %

Jul 13, 2012

87.07

85.67

87.60

85.63

1.65%

Jul 12, 2012

85.66

86.01

86.36

84.27

-0.41%

Jul 11, 2012

86.00

84.27

86.48

84.12

1.99%

Jul 10, 2012

84.33

85.13

85.94

83.67

-1.00%

Jul 09, 2012

85.17

84.34

86.48

84.26

0.96%

The recent tensions between Syria and Turkey may have broader implications for stability in the Middle East, even though neither country is a significant oil exporter. 

With OPEC spare capacity at extremely low levels (2.38 mmbbl /d as of May), the oil market is vulnerable to supply shocks.

Moreover, the thin cushion gives the cartel—particularly Saudi Arabia—a substantial amount of control over the direction of prices. For much of the year, the Saudis have chosen to open the spigots to lower prices. After the recent correction, the country may switch gears to support prices.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports and we provide daily updates and outlooks.

Major Economic Events for the week of July 9 – 13 actual v. forecast for Euro, GPB, the Franc, and USD

Date

Currency

 Event

Actual

Forecast

Previous

Jul 9

EUR

Sentix Investor Confidence

-29.6

-26.3

-28.9

 

GBP

BRC Retail Sales Monitor y/y

1.4%

 

1.3%

GBP

RICS House Price Balance

-22%

-15%

-17%

Jul 10

EUR

French Industrial Production m/m

-1.9%

-0.9%

1.4%

EUR

Italian Industrial Production m/m

0.8%

-0.3%

-2.0%

GBP

Manufacturing Production m/m

1.2%

0.1%

-0.8%

GBP

Trade Balance

-8.4B

-9.0B

-9.7B

GBP

NIESR GDP Estimate

-0.2%

 

0.1%

Jul 11

USD

Trade Balance

-48.7B

-48.5B

-50.6B

 

USD

Crude Oil Inventories

-4.7M

-1.3M

-4.3M

Jul 12

EUR

Industrial Production m/m

0.6%

0.0%

-1.1%

 

USD

Unemployment Claims

350K

376K

376K

USD

Import Prices m/m

-2.7%

-1.5%

-1.2%

USD

Federal Budget Balance

-59.7B

-91.7B

-124.6B

Jul 13

CHF

PPI m/m

-0.3%

-0.2%

-0.2%

USD

PPI m/m

0.1%

-0.5%

-1.0%

USD

Prelim UoM Consumer Sentiment

72.0

73.5

73.2

 

Historical:

Highest:   114.81 on May 02, 2011

Average: 88.78 over this period

Lowest:   67.17 on May 25, 2010

 

WEEKLY

  • This Week in Petroleum
    Release Schedule: Wednesday @ 1:00 p.m. EST (schedule)
  • Gasoline and Diesel Fuel Update
    Release Schedule: Monday between 4:00 and 5:00 p.m. EST (schedule)
  • Weekly Petroleum Status Report
    Release Schedule: The wpsrsummary.pdf, overview.pdf, and Tables 1-14 in CSV and XLS formats, are released to the Web site after 10:30 a.m. (Eastern Time) on Wednesday. All other PDF and HTML files are released to the Web site after 1:00 p.m. (Eastern Time) on Wednesday. Appendix D is produced during the winter heating season, which extends from October through March of each year. For some weeks which include holidays, releases are delayed by one day. (schedule)

 

Economic Highlights of the coming week that affect the Euro, GBP, CHF and the USD

Date

Time

Currency

 Event

Forecast

Previous

Jul 16

7:15

CHF

Industrial Production q/q

-7.5%

8.8%

9:00

EUR

CPI y/y

 

2.4%

12:30

USD

Retail Sales m/m

 

-0.2%

12:30

USD

Empire State Manufacturing Index

 

2.3

14:00

USD

Business Inventories m/m

 

0.4%

Jul 17

8:30

GBP

CPI y/y

 

2.8%

9:00

EUR

German ZEW Economic Sentiment

 

-16.9

9:15

ALL

G7 Meetings

  

12:30

USD

CPI m/m

 

-0.3%

13:00

USD

TIC Long-Term Purchases

 

25.6B

13:15

USD

Industrial Production m/m

 

-0.1%

Jul 18

8:30

GBP

Claimant Count Change

 

8.1K

8:30

GBP

Unemployment Rate

 

8.2%

9:00

CHF

ZEW Economic Expectations

 

-43.4

12:30

USD

Building Permits

 

0.78M

12:30

USD

Housing Starts

 

0.71M

14:30

USD

Crude Oil Inventories

 

-4.7M

Jul 19

6:00

CHF

Trade Balance

 

2.48B

8:00

EUR

Current Account

 

4.6B

8:30

GBP

Retail Sales m/m

 

1.4%

12:30

USD

Unemployment Claims

  

14:00

USD

Existing Home Sales

 

4.55M

14:00

USD

Philly Fed Manufacturing Index

 

-16.6

Jul 20

6:00

EUR

German PPI m/m

 

-0.3%

8:30

GBP

Public Sector Net Borrowing

 

15.6B

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