Crude Oil Weekly Fundamental Analysis July 23-27, 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 has a long story to tell. Starting with a report this week that showed the OPEC has just about exhausted their spare capacity. The EIA inventory showed a third week of declines although the decline was not as much as expected by markets. Reports showed inventories fell 0.8m barrels when forecast was over a million barrel reduction.

Date

Last

Open

High

Low

Change %

Jul 20, 2012

91.59

92.45

92.62

90.94

-0.91%

Jul 19, 2012

92.44

90.17

93.25

90.17

2.49%

Jul 18, 2012

90.19

89.33

90.36

88.91

0.94%

Jul 17, 2012

89.34

88.50

89.78

87.80

0.94%

Jul 16, 2012

88.52

87.50

88.86

86.81

1.16%

The price increase has been on the back of global tension, between the Isreali’s and Iran over a terrorist attack in Bulgaria that has claimed 6 lives thus far and growing tensions between Syria and Turkey.

Iran also continues their rhetoric over the Straits of Hormuz and this week a boat was fired upon.

“An embarked security team aboard a US navy vessel fired upon a small motor vessel after it disregarded warnings and rapidly approached the US ship near Jebel Ali,” the State Department statement said. Jebel Ali is a port city in the UAE. 
 
“The US crew repeatedly attempted to warn the vessel’s operators to turn away from their deliberate approach,” the statement said. “When those efforts failed to deter the approaching vessel, the security team on the Rappahannock fired rounds from a .50-calibre machine gun.”

Crude is expected to decline as soon as tensions ease.

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 16 – 20 actual v. forecast for Euro, GPB, the Franc, and USD

Date

Currency

Event 

Actual

Forecast

Previous

Jul 16

EUR

Core CPI y/y

1.6%

1.6%

1.6%

 

USD

Core Retail Sales m/m

-0.4%

0.1%

-0.4%

 

USD

Empire State Manufacturing Index

7.4

3.9

2.3

Jul 17

GBP

CPI y/y

2.4%

2.8%

2.8%

 

GBP

RPI y/y

2.8%

3.0%

3.1%

 

EUR

German ZEW Economic Sentiment

-19.6

-17.3

-16.9

 

USD

Core CPI m/m

0.2%

0.2%

0.2%

 

USD

TIC Long-Term Purchases

55.0B

45.7B

27.2B

 

USD

Capacity Utilization Rate

78.9%

79.2%

78.7%

 

USD

Industrial Production m/m

0.4%

0.4%

-0.2%

Jul 18

GBP

Claimant Count Change

6.1K

6.2K

6.9K

 

GBP

Unemployment Rate

8.1%

8.2%

8.2%

 

CHF

ZEW Economic Expectations

-42.5

 

-43.4

 

USD

Building Permits

0.76M

0.77M

0.78M

 

USD

Housing Starts

0.76M

0.74M

0.71M

 

USD

Crude Oil Inventories

-0.8M

0.5M

-4.7M

Jul 19

CHF

Trade Balance

2.25B

2.21B

2.52B

 

EUR

Current Account

10.9B

5.3B

5.5B

 

GBP

Retail Sales m/m

0.1%

0.6%

1.5%

 

USD

Unemployment Claims

386K

367K

352K

 

USD

Existing Home Sales

4.37M

4.64M

4.62M

 

USD

Philly Fed Manufacturing Index

-12.9

-7.9

-16.6

Jul 20

EUR

German PPI m/m

-0.4%

-0.2%

-0.3%

 

GBP

Public Sector Net Borrowing

12.1B

11.8B

16.1B

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

Previous

Jul 24

7:00

EUR

French Flash Manufacturing PMI

45.2

7:00

EUR

French Flash Services PMI

47.9

7:30

EUR

German Flash Manufacturing PMI

45.0

7:30

EUR

German Flash Services PMI

49.9

8:00

EUR

Flash Manufacturing PMI

45.1

8:30

GBP

BBA Mortgage Approvals

30.2K

9:00

EUR

Flash Services PMI

47.1

13:00

USD

Flash Manufacturing PMI

52.5

Jul 25

8:00

EUR

German Ifo Business Climate

105.3

 

8:30

GBP

Prelim GDP q/q

-0.3%

10:00

GBP

CBI Industrial Order Expectations

-11

13:00

EUR

Belgium NBB Business Climate

-13.2

14:00

USD

New Home Sales

369K

14:30

USD

Crude Oil Inventories

 

Jul 26

6:00

EUR

GfK German Consumer Climate

5.8

8:00

EUR

M3 Money Supply y/y

2.9%

12:30

USD

Core Durable Goods Orders m/m

0.7%

12:30

USD

Unemployment Claims

 

14:00

USD

Pending Home Sales m/m

5.9%

Jul 27

27th-31st

GBP

Nationwide HPI m/m

-0.6%

All Day

EUR

German Prelim CPI m/m

-0.1%

7:00

CHF

KOF Economic Barometer

1.16

12:30

USD

Advance GDP q/q

1.9%

13:55

USD

Revised UoM Consumer Sentiment

72.0

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About:FX Empire Analyst - Barry Norman

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