• 4 minutes OPEC is collapsing
  • 8 minutes And Just Like That, Everybody Stopped Talking About $100 Oil
  • 14 minutes Gaming the Price of Oil
  • 3 mins Is California becoming a National Security Risk to the U.S.?
  • 5 hours Commission: U.S. Could Lose Wars With Russia, China
  • 2 hours EU calls for sanctions against Italy
  • 5 hours Populism Rising in Canada?
  • 4 hours WTO So Set Up Panels To Rule On U.S. Tariff Disputes
  • 1 min Could EVs Become Cheaper than ICE Cars by 2023?
  • 8 mins Pros and Cons of Coal
  • 6 hours Your idea of oil/gas prices next ten years
  • 8 hours MBS Isn't Going Anywhere
  • 10 hours I Believe I Can Fly: Proposed U.S. Space Force Budget Could Be Less Than $5 Billion
  • 8 hours Oil and Gas Well Drilling
  • 6 hours US continues imports of Russian gas which it insists Europe should stop buying
  • 7 hours French Fuel Protests
Jim Hyerczyk

Jim Hyerczyk

Fundamental and technical analyst with 30 years experience.

More Info

Oil Market Forecast & Review 23rd August 2013

October Crude Oil futures failed to follow-through to the upside after last week’s surge took out the recent top at $107.85. The subsequent sell-off suggests overbought conditions and a possible shift in the fundamentals.

Earlier in the month, a falling U.S. Dollar and escalating unrest in Egypt encouraged speculators to drive up crude oil. Since crude oil is dollar-denominated, a drop in the Greenback made crude oil less expensive for foreign investors. This was expected to drive up demand. As the situation in Egypt unfolded, speculators became concerned about the possibility of supply disruptions in the Middle East.

With both supply and demand potentially being affected simultaneously, crude oil speculators experienced the “perfect trading storm” and took advantage of the situation by driving prices from $101.82 to $107.93 in a short-period of time.

As conditions improved somewhat in Egypt, speculators began to pare their long positions, instead choosing to focus on the upcoming Fed minutes which were due to be reported on August 21. This report was expected to directly affect the direction of the U.S. Dollar since it would reveal how Federal Reserve members felt about the possibility of the central bank reducing its $85 billion in monthly stimulus.

Although the Fed minutes didn’t reveal any surprises, it didn’t dispel the thought that the Fed would begin tapering as early as September. This action by the central…

To read the full article

Please sign up and become a premium OilPrice.com member to gain access to read the full article.

RegisterLogin

Trending Discussions




Oilprice - The No. 1 Source for Oil & Energy News
-->