A sustained move under $53.61 will signal the presence of sellers revealing a bull trap. This can trigger a labored break with potential targets coming in at $52.40, $51.29 and $50.66. If $50.66 fails as support then look for the supplying extend in the main retracement zone at $50.28 to $48.83.

A sustained make room $54.00 will indicate the use of buyers. This will likely also indicate that Friday’s move was fueled by fake buying rather and just buy stops. The upside momentum won’t continue and testing $54.98 is really a fantasy for buyers from fuelled trade talks.

Lifting Iranian sanctions have a significant impact on the world oil market. Iran’s oil reserves would be the fourth largest on the planet and they’ve a production capacity of around 4 million barrels a day, causing them to be the second largest producer in OPEC. Iran’s oil reserves are the cause of approximately 10% of the world’s total proven petroleum reserves, in the rate with the 2006 production the reserves in Iran could last 98 years. More than likely Iran will prove to add about A million barrels of oil per day on the market and in accordance with the world bank this may lead to the lowering of the oil price by $10 per barrel next season.

As outlined by Data from OPEC, at the start of 2013 the greatest oil deposits come in Venezuela being 20% of world oil reserves, Saudi Arabia 18%, Canada 13% and Iran 9%. Due to characteristics of the reserves it is not always easy to bring this oil to the surface given the limitation on extraction technologies and the cost to extract.

As China’s increased demand for natural gas as an alternative to fossil fuel further reduces overall demand for oil, the increase in supply from Iran and also the continuation Saudi Arabia putting more oil on top of the market should begin to see the price drop in the next 1 year and several analysts are predicting prices will get into the $30’s.

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