Crude Comment    23/07/09

Overview:

Yesterday's larger than expected cut in refinery activity of 2% and 1.5% per the API and EIA respectively seem to provide the main feature of the weekly DOE stats. Although the run cut did not translate to a crude stock build this did indicate a lack of crude demand is beginning to add substantial pressure to the front of the WTI curve.Crude fell as low as $63.76 Yesterday, trading in a $2 range to settle at $65.40, ending a five-day advance. Prices are down 11 percent from an eight-month high of $73.38 a barrel reached at the end of June. One would feel the upside in going to be limited with the Bulls struggling to justify a factor to buy and ignore that demand still appears weak, on the flip side some traders will still be optimistically focused on Federal Reserve Chairman Ben Bernanke's catiously hopeful comments about the US economy which may be enough to keep crude a float for the time being.

Crude

Crude

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9 day moving average - $ 63.00 14 day moving average - $ 62.38 40 day moving average - $66.87

Technical Report:

As mentioned in yesterdays 'Crude Comment' we see consolidation in yesterdays trade with the 9 day moving average pointing up now crossing the 14 day pointing down indicating a possible change in the current short term bullish trend to more of a tighter sideways range.

The short and medium term trend is sideways , long term trend remains bearish.

WTI:

Support: $63.98 (low of 21/07/09) Resistance: $67.15 (high of 03/07/09)

Support: $63.76 (low of 22/07/09) Resistance: $66. 68 ( high of 21/07/09 )

Support: $63.39 (low of 06/07/09) Resistance: $65.76 ( Yesterday's high )

OIL (BRENT):

Support: $66.21 ( low of 02/07/09 ) Resistance: $69.19 (high of 02/07/09)

Support: $65.69 (low of 21/07/09) Resistance: $68. 65 (high of 03/06/09)

Support: $65.19 (low of 20/07/09) Resistance: $67. 92 (high of 21/07/09)

DOE Stock ( change in millions of barrels)

Crude -1.8 Gasoline +0.8 Distillates +1.2 Refineries Ran At 85.84%

** The ODL Brent crude oil contract (Oil) trades between 07:15 and 21:00 UK Time **

** The ODL WTI crude oil contract (WTI) trades between 01:15 and 22:00 UK Time **

** The ODL Gas Oil contract (GSO) trades between 07:15 and 21:00 UK time **

The ODL oil contracts are based on the front month (September) of the ICE contracts:

Friday's Settlements Oil: September - $67.21    October - $67.94    

Friday's Settlements WTI: September - $65.40                  October -       $67.04         

The ODL oil contracts roll monthly on the day before the ICE Brent front month expiry on the settlement of the front spread

Next rollover: 13/08/2009