A sustained move under $53.61 will signal the use of sellers which indicates a bull trap. This will likely trigger a labored break with potential targets weighing $52.40, $51.29 and $50.66. If $50.66 fails as support discover the selling to extend in to the main retracement zone at $50.28 to $48.83.

A sustained make room $54.00 will indicate a good buyers. This may also indicate that Friday’s move was fueled by fake buying rather and just buy stops. The upside momentum is not going to continue and testing $54.98 is a fantasy for buyers from fuelled trade talks.

Lifting Iranian sanctions may significant effect on the planet oil market. Iran’s oil reserves would be the fourth largest on the planet and they have a production capacity of about 4 million barrels every day, driving them to the second largest producer in OPEC. Iran’s oil reserves take into account approximately 10% from the world’s total proven petroleum reserves, on the rate in the 2006 production the reserves in Iran could last 98 years. More than likely Iran create about 2million barrels of oil each day for the market and according to the world bank this may result in the cut in the oil price by $10 per barrel next year.

Based on Data from OPEC, at the beginning of 2013 the greatest oil deposits will be in Venezuela being 20% of worldwide oil reserves, Saudi Arabia 18%, Canada 13% and Iran 9%. Due to the characteristics of the reserves it is not always possible to bring this oil for the surface in the limitation on extraction technologies and the cost to extract.

As China’s increased interest in gas as an alternative to fossil fuel further reduces overall need for oil, the rise in supply from Iran along with the continuation Saudi Arabia putting more oil on the market should start to see the price drop in the next 1 year and several analysts are predicting prices will belong to the $30’s.

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