Crude Oil ended the week with a gain of over 5% to 46.02 while Brent oil closed at 47.39 as the rally continued all week. Oil prices ended steady Friday
Crude Oil ended the week with a gain of over 5% to 46.02 while Brent oil closed at 47.39 as the rally continued all week. Oil prices ended steady Friday after hitting 2016 highs, but finished April trading about 20 percent higher, with Brent crude having its best monthly gain in seven years.
A weaker U.S. dollar amid optimism that a global oil glut will ease have lifted crude futures by more than $20 a barrel since they plumbed 12-year lows under $30 in the first quarter.
But others warned the rally was driven by investors holding large speculative positions, while oil stockpiles were still high, with a Reuters survey showing OPEC output in April rising to its highest level in recent history.
“The issue is that we haven’t seen price rallies … correlate with fundamentals,” said Hamza Khan, senior commodity strategist at ING. “The fundamentals — high stocks, high production — haven’t changed.”
Technical analysts said crude could cruise to $50 a barrel but stiffer resistance before $55 could spark profit-taking on the market’s biggest rebound in two years.
Analysts polled by Reuters raised their average forecast for Brent in 2016 to $42.30 per barrel, the second consecutive month of increases.
Bank of America Merrill Lynch said in a note that “non-OPEC oil supply is indeed hanging off a cliff” and estimated that global output would contract year-on-year in April or May for the first time since 2013.
The OPEC survey aside, Saudi oil output was expected to edge up by 350,000 barrels per day to around 10.5 million bpd, sources told Reuters, as tankers filled with unsold oil floated at sea seeking buyers. (International Business Times)
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.
WEEKLY
This Week in Petroleum
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Gasoline and Diesel Fuel Update
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Weekly Petroleum Status Report
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Major Economic Events for the week:
Time | Cur. | Event | Actual | Forecast | Previous | |||
Sunday, May 1, 2016 | ||||||||
CNY | Manufacturing PMI (Apr) | 50.4 | 50.2 | |||||
Monday, May 2, 2016 | ||||||||
United Kingdom – Early May Bank Holiday | ||||||||
China – Labor Day | ||||||||
CNY | Caixin Manufacturing PMI (Apr) | 49.7 | ||||||
EUR | German Manufacturing PMI (Apr) | 51.9 | 51.9 | |||||
USD | ISM Manufacturing PMI (Apr) | 51.5 | 51.8 | |||||
Tuesday, May 3, 2016 | ||||||||
Japan – Constitution Day | ||||||||
CNY | Caixin Manufacturing PMI (Apr) | 49.9 | 49.7 | |||||
AUD | Interest Rate Decision (May) | 2.00% | 2.00% | |||||
GBP | Manufacturing PMI (Apr) | 51.2 | 51.0 | |||||
Wednesday, May 4, 2016 | ||||||||
Japan – Greenery Day | ||||||||
NZD | Employment Change (QoQ) (Q1) | 0.9% | ||||||
GBP | Construction PMI (Apr) | 54.0 | 54.2 | |||||
USD | ADP Nonfarm Employment Change (Apr) | 200K | 200K | |||||
USD | ISM Non-Manufacturing PMI (Apr) | 54.6 | 54.5 | |||||
USD | Crude Oil Inventories | 1.999M | ||||||
Thursday, May 5, 2016 | ||||||||
Japan – Children’s Day | ||||||||
AUD | Retail Sales (MoM) (Mar) | 0.3% | ||||||
GBP | Services PMI (Apr) | 53.5 | 53.7 | |||||
Friday, May 6, 2016 | ||||||||
USD | Nonfarm Payrolls (Apr) | 200K | 215K | |||||
USD | Unemployment Rate (Apr) | 5.0% | 5.0% | |||||
CAD | Employment Change (Apr) | -1.5K | 40.6K | |||||
CAD | Ivey PMI (Apr) | 50.1 |
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