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Tuesday, May 15, 2012

crude oil prices forecast may 16 2012

crude oil prices forecast may 16 2012, how will impact european debt crisis on oil prices : Oil dropped for a fourth day in New York after U.S. crude stockpiles increased and Greek talks to form a coalition government collapsed, raising concern the nation will exit the euro and worsen the region’s debt crisis.

Futures slipped as much as 1 percent from the lowest settlement in almost five months yesterday. U.S. inventories rose 6.6 million barrels last week, American Petroleum Institute data showed. A government report today is forecast to post a gain of 1.8 million, according to a Bloomberg News survey. Greece will schedule new elections as early as June 10, which German Finance Minister Wolfgang Schaeuble called a referendum on whether the country stays in the euro.

“Demand destruction is back on the agenda,” said Jonathan Barratt, chief executive of Barratt’s Bulletin, a commodity- markets newsletter in Sydney. “The market is going to remain weak over the next month or so until we get some clarity of what’s happening in the world. Greek turmoil is a problem.”

Crude for June delivery decreased as much as 93 cents to $93.05 a barrel in electronic trading on the New York Mercantile Exchange, and was at $93.37 at 11:14 a.m. Sydney time. The contract yesterday fell 0.8 percent to $93.98, the lowest close since Dec. 19. Prices are 5.5 percent lower this year.

Brent oil for June settlement, which expires today, slipped 0.5 percent to $111.64 a barrel on the London-based ICE Futures Europe exchange. The more-actively traded July contract slid 0.6 percent to $110.78. The European benchmark contract’s premium to West Texas Intermediate was at $18.27, after closing at $18.26 yesterday, the widest gap since April 13.

Cushing Record
Oil in New York has long-term technical support at $89.83 a barrel, according to data compiled by Bloomberg. On the weekly chart, that’s the 50 percent Fibonacci retracement of the fall to $32.40 in December 2008 from a record high of $147.27 in July that year. Buy orders tend to be clustered near chart-support levels. Futures last traded at that price in November 2011.

Crude inventories at Cushing, Oklahoma, the delivery point for futures traded on the New York Mercantile Exchange, rose 2.8 million barrels last week to a record 46.9 million barrels, according to the industry-funded API.

U.S. gasoline stockpiles dropped 2.6 million barrels, it said. They are forecast to fall 100,000 barrels in today’s Energy Department report, according to the median estimate of 12 analysts surveyed by Bloomberg. Distillate inventories, a category that includes diesel and heating oil, slid 1.6 million barrels compared with a projected 150,000 barrel gain.

The API collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the Energy Department for its weekly survey.

Euro Crisis
Post-election attempts to form a government in Greece broke down yesterday after nine days as President Karolos Papoulias failed to broker a coalition in meetings with party leaders in Athens. New elections may be held next month. Four surveys have given the lead to the anti-bailout Syriza party that says it would tear up the conditions attached to 240 billion euros ($306 billion) of aid.

The euro slumped to an almost four month low, making dollar-denominated oil more expensive for holders of the European single currency.

New York crude has dropped 16 percent since March 1, when concern that Western sanctions against Iran’s nuclear program would disrupt Middle East supplies helped drive prices to $110.55 a barrel, the high for the year. Brent has fallen 13 percent since reaching a high of $128.40 the same day.

Iran and International Atomic Energy Agency inspectors extended a round of negotiations over the Persian Gulf nation’s nuclear program after two days of talks ended in Vienna yesterday with both sides saying progress had been made. IAEA inspectors will meet again with their Iranian counterparts on May 21 in the Austrian capital.

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