The weekly average prices of the Organization of Petroleum Exporting Countries (OPEC) dropped for three consecutive weeks, falling by 1.37 compared to the previous week to 105.07 bbl last week, the Vienna-based cartel said Monday.
OPEC daily Crude Oil price, which moved in a clear "V" trend last week, fell to 101.55 bbl on the 1st trading day, representing the lowest level of OPEC daily oil price since February 21 this year.
However, it kept rising in the following 3 trading days, increasing to 107.50 bbl on June 30. But Friday last week, it fell by 1.99 to 106.5 bbl.
The international Crude Oil market last week was affected by many factors. Although the availability of 60M bbls of Crude Oil stocks announced by the International Energy Agency (IEA) suppressed Crude Oil prices at first, its influence quickly wore off.
We here at LTN believe that the full effect of the IEA's decision has been seen on the market.
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In addition, the EuroZone manufacturing purchasing managers index (PMI), which reached a low level of 54.6 in May, fell further to 52 in June, marking a record low for 18 months.
According to a report from Markit, an economic survey organization, at present, the expansion of the manufacturing sector in Germany and France is slowing down; while in Italy, Greece, Spain and other countries, it continues to contract. The overall economy in the EuroZone remains weak.
At the same time, Greece adopted a new round of austerity measures, which would clear the way for further monetary assistance. The concerns caused by short-term debt issues in Europe may therefore decrease, thereby increasing confidence in the oil market.
Figures from the Institute for Supply Management (ISM) showed that US manufacturing PMI rose from 53.5 in May to 55.3 in June. The growth in the U.S. manufacturing sector means that the slowdown could be easing up.
Market analysts believe weakening concerns about European debt and strong economic figures from the US will boost the international Crude Oil prices. Stay tuned...
Paul A. Ebeling, Jnr.
Paul A. Ebeling, Jnr. writes and publishes The Red Roadmaster's Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world. Paul A. Ebeling, Jnr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels. www.livetradingnews.com
