Crude Oil weekly special report based On 1.00 Lot Calculation:
TECHNICAL REVIEW:
- STATISTICS: CRUDE OIL HAS TESTED THE RANGE OF $62- $70 FOUR TIMES SINCE FEBRUARY 2021. This is the sixth time trying to test the region. After testing the region, Crude oil would come back up, to target the $80- $90 range.
Graph (Weekly): Crude Oil
Please note that past performance does not guarantee future results.
OIL MARKETS ARE STILL EXPECTED TO GET INTO DEFICIT:
- OPEC+ TO BE CUTTING OIL PRODUCTION BY 4.66 MILLION BARRELS A DAY in 2023 AFTER SAUDI ARABIA PLEDGED AN ADDITIONAL 1 MILLION BARRELS A DAY OF PRODUCTION CUTS IN JULY 2023. Saudi's energy ministry said the country's output would drop to 9 million barrels per day (bpd) in July from around 10 million bpd in May, the biggest reduction in years. OPEC+ had in place cuts of 3.66 million bpd, amounting to 3.6% of global demand, including 2 million bpd agreed last year and voluntary cuts of 1.66 million bpd agreed in April. Those cuts will be extended until the end of 2024.
- US DRIVING SEASON STARTS AT THE END OF MAY UNTIL EARLY SEPTEMBER. When the driving season in the US, the largest petroleum consumer in the world, gets underway analysts see higher consumption and therefore higher demand.
- CHINA’S ECONOMY KEEPS RECOVERING ALONG WITH SURGING OIL DEMAND. China reported stronger than expected pace of economic recovery in Q1 of 2023. Data showed that their economy rose by 4.5% in Q1 amid expectation for an increase of 4.00%. Stronger China economy implies higher oil demand, as China remains to be the largest oil importer in the world (importing more than 11 million barrels a day) and second largest oil consumer in the world (expected to consume a record 16 million barrels a day in 2023)
- DEFICIT CREATION: FALLING SUPPLY AMID RISING DEMAND COULD CREATE A DEFICIT. The above analyzed points show that demand could be expected to outpace supply, creating a hole that is known as deficit. According to Goldman Sachs, that deficit could be as much as 1.5 million barrels a day.
DOWNWARD PRESSURE LOOKS CONTROLLED BY TWO MAIN FACTORS:
- US STRATEGIC PETROLEUM RESERVES (SPR) TO REFILL AT $68 - $72. NEXT POTENTIAL TIMING: Q3, 2023. The Biden administration will start buying crude to replenish the strategic petroleum reserve when prices fall to $68- $72 per barrel. President Biden ordered the release of a total of 180 million barrels of crude this year in response to a price rally caused by Russia’s invasion of Ukraine. Currently, the Strategic Petroleum Reserves stand at 371.6 million barrels, its lowest since early 1980’s.
- SAUDI ARABIA: Saudi Arabia, de facto OPEC leader, maintains a fiscal breakeven oil price of around $80 a barrel.
ANALYST OPINION:
- JPMorgan forecasts $94 in 2023. Goldman Sachs predicts $95 by the end of the year. UBS forecasts $95 a barrel. Bank of America forecasts oil at $90 a barrel. Barclays predicts $87 by the end of the year
Crude Oil, June 5, 2023
Current Price: 73.00
|
Crude Oil |
Weekly |
|
Trend direction |
|
|
90.00 |
|
|
85.00 |
|
|
80.00 |
|
|
67.00 |
|
|
64.00 |
|
|
62.00 |
Example of calculation base on weekly trend direction for 1.00 Lot1
|
Crude Oil |
||||||
|
Pivot Points |
||||||
|
Profit or loss in $ |
17,000 |
12,000 |
7,000 |
-6,000 |
-9,000 |
-11,000 |
|
Profit or loss in €2 |
15,899 |
11,223 |
6,547 |
-5,611 |
-8,417 |
-10,287 |
|
Profit or loss in £2 |
13,702 |
9,672 |
5,642 |
-4,836 |
-7,254 |
-8,866 |
|
Profit or loss in C$2 |
22,828 |
16,114 |
9,400 |
-8,057 |
-12,086 |
-14,771 |
1. 1.00 lot is equivalent of 1000 units
2. Calculations for exchange rate used as of 13:19 (GMT+1) 05/06/2023
Fortrade recommends the use of Stop-Loss and Take-Profit, please speak to your Senior Account ManagerClient Manager regarding their use.
- You may wish to consider closing your position in profit, even if it is lower than suggested one
- Trailing stop technique can protect the profit – Ask your Senior Account ManagerClient Manager for more detail