Market Analysis

Dynamics

Trades in the oil market on Friday, July 24, were mixed. However, the closure of a regular session, rose in price quotes on a background to the FOREX market is the lack of positive change in favor of the dollar.

At the New York Stock Exchange NYMEH cost of the September futures for U.S. light crude oil rose by 0.89 dollars and its price, therefore, amounted to 68.05 dollar per barrel.

At the ISE Stock Exchange in London mark Brent oil price rose to 70.32 dollars per barrel.

Causes

After some consolidation in the region of $ 65 per barrel price of black gold have gone into growth, but for a while to test the technical level of resistance of 67.63 dollars (61.8% Fibo of levels). But against the backdrop of good quarterly reports of U.S. companies, sales growth of secondary housing in the U.S. in June, as well as investor confidence that the U.S. economy out of recession, prices continued their ascent to the peak session. In the past trading week, crude oil went up by more than 7%.

news worth noting that the American company Noble Energy Inc. intends to put into operation oil field Aseng by mid 2012, after obtaining the approval of the draft by the board of directors, business partners and the Ministry of Energy of Equatorial Guinea. The project cost is estimated at 1.3 billion dollars. This will be the first field in the territorial waters of Equatorial Guinea in the Douala basin with oil and the first field in the country, developed by Noble (its share in the project - 40%). Production will be from five subsea wells drilled to a depth of 945 m. The sea and connected to a system of floating oil production, storage and unloading (FPSO). Oil will be sold directly from the vessel, and gas and water will be pumped into the formation to maintain pressure in the main reservoir in order to increase the coefficient of extraction of liquid hydrocarbons. The possible production of liquid hydrocarbons, provided FPSO, will be 120 thousand barrels per day, including for oil - 80 thousand barrels per day. The gas will be injected at a rate of 4.8 million cubic meters per day. The capacity of storage of oil and condensate will be 1.5 million barrels.

What to expect?

Hopes for growth in demand for oil by the end of a recession in the United States - the world's largest consumer of energy - have helped oil rates up to 14% with a minimum of two months, marked in mid-July. In general, the dynamics of the market is quite optimistic. Most likely, next week the oil will be traded above the mark of 65 dollars per barrel. The main factors will continue to serve the American statistics, the rally in equity markets and good corporate reporting.

What is fear?

However, recall that the growth is impossible without correction. Quotations for all commercial sites do not grow the first session running. Many technical indicators are in the deep zone perekuplennosti that involves correction of the depth of which will depend on the current situation in the market.

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