United States Oil (USO) looking for alternative oil supplies
The United States—which is pushing to have all Iranian oil customers stop importing crude from Tehran—is looking for alternative oil supplies for its allies whose imports will be disrupted by the U.S. sanctions on Iran.
While during the previous U.S. and EU sanctions on Iran between 2012 and 2015, the U.S. Administrations had issued waivers for Iranian oil imports for some of its allies like South Korea, Japan, and India, this time the Trump Administration has adopted a much tougher stance and is pushing to bring Iranian oil exports down to zero.
After a meeting with India’s most senior politicians earlier this month, U.S. Secretary of State Mike Pompeo said that the United States would consider waivers “where appropriate”, but reiterated that the United States eventually expects to bring Iranian oil exports to zero.
“We have told the Indians consistently, as we have told every nation, that on November 4th the sanctions with respect to Iranian crude oil will be enforced, and that we will consider waivers where appropriate, but that it is our expectation that the purchases of Iranian crude oil will go to zero from every country, or sanctions will be imposed,” Secretary Pompeo said, noting that many countries would need “a little bit of time to unwind.”
South Korea, Japan, and India are all negotiating waivers, but until they receive clarity on the issue, South Korea and Japan are not risking sanctions in case they won’t get exemptions.
South Korea did not import any Iranian oil in August, compared to 194,000 bpd in imports from Iran in July, according to tanker-tracking and shipping data compiled by Bloomberg.
Japanese refiners have temporarily suspended oil imports from Iran, buying alternative supplies and watching the situation closely should waivers be forthcoming, the president of the Petroleum Association of Japan (PAJ), Takashi Tsukioka, said on Thursday.
Looking to win waivers, India is reportedly significantly reducing Iranian oil purchases this month and next. India’s imports from Iran are expected at 360,000 bpd-370,000 bpd for September/October compared to 658,000 bpd for April-August, according to data from trade sources obtained by Reuters.
Overall, the bias in prices is: Upwards.
Note: this chart shows extraordinary price action to the upside.
The projected upper bound is: 15.40.
The projected lower bound is: 14.22.
The projected closing price is: 14.81.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 4 black candles for a net of 1 white candles. During the past 50 bars, there have been 22 white candles and 25 black candles for a net of 3 black candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 74.0740. This is not an overbought or oversold reading. The last signal was a sell 12 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 58.64. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 56 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 116.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 5 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 2 period(s) ago.
Rex Takasugi – TD Profile
UNTD ST OIL FUND closed down -0.140 at 14.800. Volume was 26% below average (neutral) and Bollinger Bands were 51% narrower than normal.
Open High Low Close Volume___
15.020 15.045 14.780 14.800 14,768,638
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 14.58 14.29 13.37
Volatility: 26 26 29
Volume: 15,087,757 18,798,260 19,289,878
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
UNTD ST OIL FUND is currently 10.7% above its 200-period moving average and is in an upward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of USO at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on USO and have had this outlook for the last 17 periods.
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