Oil Fundamental Analysis – week of August 29, 2016 – Forecast

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Published: Aug 27, 2016, 05:31 UTC

Crude Oil ended the week at the bottom of its trading range after a mid-week rally on hopes from the OPEC meeting. Oil will enter the new week at 47.44

Oil Fundamental Analysis – week of August 29, 2016 – Forecast

Crude Oil ended the week at the bottom of its trading range after a mid-week rally on hopes from the OPEC meeting. Oil will enter the new week at 47.44 with a loss for the week of 2.25% and is a strong buy moving into the week. The deals follow a period of relative quiet as buyers and sellers failed to agree on valuations amid oil’s decline. North America, home to many higher-cost shale drillers, saw the fewest transactions last year since 2004, according to data compiled by Bloomberg. Benchmark Brent crude averaged $35.21 a barrel in the first quarter of 2016, the lowest in more than a decade.

More than $11 billion of transactions were announced globally in July as crude’s recovery fueled hopes of a steadier market, Wood Mackenzie Ltd. said. That’s the highest monthly total this year and brings the amount since May to $32 billion, triple that of the previous three months. Dealmaking will continue to accelerate as oil prices stabilize, according to the consulting firm.

Oil futures have rallied more than 10 percent since the Organization of Petroleum Exporting Countries said it would hold informal talks in Algeria in late September, fueling expectations it could revive a pact on freezing production. Banks from Citigroup Inc. to Bank of America Merrill Lynch see a simpler explanation for the rebound: the global oil oversupply is finally dissipating.

OPEC is unlikely to agree on a freeze next month as the same political rivalry between Gulf members Saudi Arabia and Iran that thwarted a similar initiative in April remains an obstacle, analysts from Citigroup to Commerzbank AG say.

Signals from producers that the group may act are simply “jawboning” to push prices higher, Ed Morse, head of commodities research at Citigroup in New York, said in a Bloomberg Television interview.

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Upcoming Economic Events that you should be monitoring:

Week beginning August 29, 2016

Date	Country	Name	Volatility	Previous	Consensus
8/31/2016	EUR	Unemployment Rate	3	6.1	6.1
8/31/2016	EUR	Unemployment Change	3	-7	-4
8/31/2016	EUR	Consumer Price Index – Core	3	0.9
8/31/2016	EUR	Consumer Price Index (YoY)	3	0.2	0.3
9/1/2016	USD	ISM Manufacturing PMI	3	52.6	52.4
9/1/2016	USD	ISM Prices Paid	3	55
9/2/2016	USD	Unemployment Rate	3	4.9	4.8
9/2/2016	USD	Nonfarm Payrolls	3	255	164