New York prices have mostly been weighed down by plentiful crude supplies in the key transit hub of Cushing, Oklahoma, in the United States -- which is the world's biggest global oil consuming nation. However, London Brent oil has found solid support from mounting supply concerns on the back of violent unrest in Libya and Nigeria, alongside falling North Sea production.
Brent was also driven up by news of a fresh supply outage in Nigeria, which is Africa's largest crude producer and the eighth biggest in the world.
Shell in Nigeria on Monday declared "force majeure"and warned it may not be able to meet its contractual obligations for Bonny Light crude -- a type of Nigerian oil -- after multiple pipeline fires and leaks blamed on sabotage.
The Brent July contract's expiry on Wednesday could have also played a role in the record price differential, Varga added.
Another factor has been unrest in Libya, which erupted in February and has removed about 1.3 million barrels per day from the global oil market. There are also supply factors affecting the prices such as a re-opened oil pipeline from Canada to America and lower loading expectations in the North Sea in July.
Oil Technical Analysis Monday June 20, 2011
Light Sweet Crude
The CL contract fell on Friday, and looks very weak at the moment. The $95 level has been broken, and it seems that the bearish pressure will continue in this market as traders have been tossing out risk in their accounts. $92.50 has held, but it look like we are eventually getting to lower levels. A bounce could come, but it will probably attract more sellers at the end of the day.
Brent
The Brent markets fell, but popped up in the late hours of trading on Friday. This formed a bullish hammer, and it seems that the contract will still have fight in it, even as the CL shows more and more weakness. This makes sense as the Brent form of oil is more likely to be affected by turmoil and disruptions in the Middle East. With the situation in Libya and other places, Brent will certainly be the stronger of the two contracts over time.
tag ; Brent crude oil forecast june 20 2011, oil prices june 20 2011, Light Sweet Crude prediction june 20 2011, global oil market outlook june 2011, imfact oil price on situation in Libya.
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