WTI has made an additional high in North American trade and pierced 69 the figure with a high so far of $69.17bbls, extending its reversal from the lows of $66.31bbls. What is next? This 6 August WTI Crude Oil Price Fundamental Forecast reveals.
6 August, OctaFX – The data came as surprise to traders who had believed that Saudi production would have risen in July given the pledges from Russia and the Organization of the Petroleum Exporting Countries where they had supposedly agreed in late June to begin ramping up crude output after more than twelve months of curbing output.
Markets will have to wait for an official monthly report from OPEC for July’s output on August the 13th.
The Iran Factor
Additionally, Iran is a factor. Trump administration’s first deadline for companies to wind down some transactions with Iran starting this week of which will hit Iran’s ability to access dollars, engage in some financial activity and attract investment into its auto and aviation industry.
However, there are no energy sanctions imposed at this stage, but there will be some due later this year and this action send a message that Washington is not backing down on that, which is impacting the price of futures.
Iran’s oil exports may fall by as much as two-thirds this year because of the US move and ultimately blocking more than 1 million barrels a day of Iran’s roughly 2.5 million barrels a day of crude exports – (This follows when Trump gave banks and companies 90 days to get set for such sanctions after he scrapped the 2015 Iran nuclear deal back in May.
Iran’s currency, the rial, has been in free-fall ever since and the economy has been negatively impacted which has set off protests across the nation).
Next up this week will be the weekly API’s Weekly Statistical Bulletin and then the U.S. inventory data from the Energy Information Administration.
6 August WTI Crude Oil Price Fundamental Forecast
WTI has penetrated the daily trend line resistance at 6900/6910 and now targets a test of 6940 before the three-week trend line resistance at 7000/7010 where a run of 7045 stops open a target price of 7115. 6870 and 6830/20 ahead of 6780/70 around Friday’s lows are key downside targets ahead of the range low at 6700/6690.
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