Oil Fundamental Analysis – December 30, 2015 – Forecast

Analysis and Recommendations:

Crude Oil recovered 19 cents to retrace the $37 price level while Brent Oil was up at 36.80 as premiums remain distorted. Iran is scaling up production and ramping up exports as the oil sanctions are removed. The National Iranian Oil Company reported that it would scale up production by 500,000 barrels per day within the week after the sanctions are lifted. This fueled the long-term oversupply concerns. As a result, prices tumbled after recovering from historic lows in the last week. US WTI is still trading close to 2009 lows and Brent is trading close to its 11-year low.

The Chinese National Bureau of Statistics reported that Chinese industrial profits fell to $103.8 billion in November 2015 compared to last year. The Ministry of Finance reported that earnings of state-owned companies have fallen by 9.5% so far in 2015. As a result, Chinese stocks tumbled the most in the last three weeks. The fall in industrial profit cemented the slowdown of the Chinese economy in 2016. China is the second largest importer and consumer of crude oil. The slowing Chinese economy could negatively affect the demand for crude oil and affect oil prices.

Prices jumped last week after data showed an unexpected fall in US commercial crude stock, with West Texas Intermediate (WTI) adding almost 10%.

FxEmpire provides in-depth analysis for each asset 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 up to the data analysis and information in our weekly reports, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.

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Today’s economic releases:

 

Upcoming Economic Events that you should be monitoring:

Wednesday, December 30, 2015

Government Bond Auctions

Date Time Country

Dec 29 11:10 Italy Auctions CTZ

Dec 29 n/a UK Announces details of Gilt auction on Jan 05 & 07

Dec 29 19:00 US Holds 5-year note auction

Dec 30 11:10 Italy Auctions BTPs/CCTeus

Dec 30 19:00 US Holds 7-year note auction