WTI Crude Oil Price Seen At $55 Next Week

Posted by: : Paul EbelingPosted on: December 13, 2014 WTI Crude Oil Price Seen At $55 Next Week

WTI Crude Oil Price Seen At $55 Next Week

$OIL, $USO, $BHI

WTI Crude Oil prices are set to mark 55 bbl next week after a 6 month decline pushed the benchmark price to the lowest in 5 yrs.

WTI Crude Oil ended at 57.29 Friday for the 1st time since May 2009 after the IEA cut its global demand forecast for the 4th time in 5 months. Prices are down 46%+ from this year’s highest close of 107.26 on 20 June .

By taking out the support at 58, Crude Oil is moving towards the next target at 55.

WTI for January delivery dropped to 57.29 bbl Friday on the New York Merc.  Brent Crude Oil fell 1.83 to $61.85 on the London-based ICE Futures Europe exchange, the lowest since July 2009.

Both benchmarks have fallen about 20% since 26 November the day before OPEC (Organization of Petroleum Exporting Countrie)s agreed to leave its production limit unchanged at 30-M BPD.

US Crude Oil output, at a 30 yr high, will continue to rise in Y 2015, according to the IEA. The Paris-based agency reduced its estimate for Crude Oil demand growth in Y 2015 by 230,000 BPD.

That said the price could be 55 or lower next week involatile trade.

HeffX-LTN’s target is 45 bbl, as the market has not seen the response it is looking for on the supply side yet, so in such an environment prices are going to keep drifting down until the market is satisfied that production growth will slow. And that the message has been received and acted on by operators.

Participants will be focused on drillers’ Q-4 earnings statements and listening in on their earnings calls next month to gauge how much production growth will slow. Oil wells with higher operating costs come under pressure at 45 bbl Crude Oil.

Low oil prices will likely slow US shale Oil production.

US Crude Oil drillers idled the most rigs in almost 2 yrs this past week.

Oil rigs  dropped by 29 to 1,546, the lowest level since June and the biggest decline since December 2012, Baker Hughes (NYSE:BHI)said on its website Friday.

HeffX-LTN Analysis for OIL: Overall Short Intermediate Long
Very Bearish (-0.76) Very Bearish (-0.50) Very Bearish (-0.96) Very Bearish (-0.83)

Stay tuned…

HeffX-LTN

Paul Ebeling

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Paul Ebeling

Pattern Recognition Analyst, equities, commodities, forex
Paul Ebeling is best known for his work as writer and publisher of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly-regarded, weekly financial market letter, where he enjoys an international audience among opinion makers, business leaders, and respected organizations. Something of a pioneer in online stock market and commodities discussion and analysis, Ebeling has been online since 1994. He has studied and worked in the global financial and stock markets since 1984.
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