Oil Holding Steady
Today’s Spotlight Market
Crude Oil futures held steady yesterday going into this morning, despite bearish supply side and currency news.? OPEC has not curtailed production, but rather, ramped up in recent months.? This is counterintuitive, given the extremely large oversupply of Oil on the market.? However, it is also not surprising and can be viewed as a prime example of the distrust among members of the petroleum cartel.? None of the member nations trusts the others to keep to their production quotas.? This week?s OPEC meeting is expected to show official quotas unchanged.? ?
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Fundamentals
OPEC countries pumped 31.22 million barrels of Crude Oil a day in May, according to a Reuter?s survey.? This is the highest production from the cartel in 2 ? years.? Saudi Arabia continues to pump near record levels of Oil, and Iraqi exports hit a new record in May.? Not all fundamental news favors the bear camp.? Cushing, OK, a key storage hub for US petroleum, saw a drawdown for the 5th consecutive week.? There was also a surprising increase in refinery activity, which is a metric traders may want to keep an eye on in upcoming EIA reports to gauge whether or not this was an anomaly or a trend.? There was also a new decline in US Oil rig count, countering the popular opinion that the number of rigs was slated to increase. The US Dollar is a bit of a wild card at the moment.? It looked as though a Greek debt deal was all but done, which could have been seen as Euro positive/Dollar negative, but the ongoing negotiations have become strained.? This has been supportive of the Dollar in the near-term.? Greece is up against the clock and needs to get a deal done in the next 2 days.
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Technical Notes? -? View Today’s Chart
Turning to the chart, we see the July Crude Oil contract centering around the $60 level.? There is little technically to point to where the Crude Oil market may break out.? The chart is consolidating, the RSI is neutral, and momentum is flat.? The preceding up-move in the Oil market does slightly favor the upside, but that influence fades the longer the market consolidates.
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