Crude & Brent Oil Fundamental Analysis – August 19, 2015 – Forecast

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Updated: Aug 18, 2015, 10:50 UTC

Analysis and Recommendations: Crude Oil eased by 30 points to trade at 42.11 while Brent Oil dipped 28 points to 48.46. Oil fell about 1 percent with U.S.

Crude & Brent Oil Fundamental Analysis – August 19, 2015 - Forecast

Analysis and Recommendations:

Crude Oil eased by 30 points to trade at 42.11 while Brent Oil dipped 28 points to 48.46. Oil fell about 1 percent with U.S. crude settling within range of a new 6-1/2-year low, after No. 3 oil consumer Japan said its economy contracted in the second quarter and China’s slowdown continued to weigh on sentiment. Since June 24th, crude oil prices have plummeted 31%, as fears of a global storage surplus, weakening Chinese demand, and a strong U.S. dollar have plagued the commodity and erased the late spring/early summer rally. Oil settled Friday just off a 6-year low at $42.50/barrel.

Crude oil prices might have risen slightly due to bottom fishing or short covering. Some traders might have thought this opportunity would continue. However, the recent consensus of the rising Cushing stockpile in the oversupplied market could drag crude oil prices lower.

On Friday, the US Dollar Index appreciated against the global currencies. The improving US economic conditions supported the US dollar. The appreciating dollar puts downward pressure on crude oil prices.

Baker Hughes reported that the crude oil rig count rose for the fourth consecutive week despite the catastrophic fall in crude oil prices. This shows that the oil bear market isn’t over.

Iran’s nuclear accord and easing of the oil sanctions by the end of 2015 could step up Iran’s output by 100,000 bpd (barrels per day). The record output from the US, Russia, and the Middle East will continue to extend the crude oil bear market.

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Today’s economic releases:

Cur.	Event	Actual	Forecast	Previous
USD	TIC Net Long-Term Transactions (Jun)	103.1B	23.0B	93.0B
AUD	Monetary Policy Meeting Minutes
GBP	CPI (YoY) (Jul)	0.1%	0.0%	0.0%
GBP	CPI (MoM) (Jul)	-0.2%	-0.3%	0.0%
GBP	PPI Input (MoM) (Jul)	-0.9%	-1.9%	-1.8%

Upcoming Economic Events that you should be monitoring:

Wednesday, August 19, 2015

Cur.	Event	Actual	Forecast	Previous
USD	API Weekly Crude Oil Stock			-0.847M
NZD	PPI Input (QoQ) (Q2)			-1.1%
JPY	Exports (YoY) (Jul)		5.5%	9.5%
JPY	Trade Balance (Jul)		-57B	-69B
USD	Core CPI (YoY) (Jul)		1.8%	1.8%
USD	Core CPI (MoM) (Jul)		0.2%	0.2%
USD	CPI (MoM) (Jul)		0.2%	0.3%
RUB	Unemployment Rate (Jul)		5.5%	5.4%
USD	Crude Oil Inventories			-1.682M