Crude Oil Fundamental Analysis May 23, 2012, Forecast

By FXEmpire.com

Analysis and Recommendations:

Crude Oil continued its decline, trading at 92.25 down 0.60. Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa. With high inventories and still higher production and a continued drop in demand, oil will continue to drift downward.

Tomorrow is the official date of the Iran talking but in meetings that began earlier this week, the IAEA and Iran agree on terms for inspection. Analysts estimate that Iran could easily double its production of crude oil, if there were market demand.

With geopolitical tensions reduced and a worldwide glut oil is expected to stay in the low 90’s if not drop under into the upper 80’s by the end of the quarter.

Hopes over fresh initiatives by European leaders to tackle the crisis that hit Euro Zone boosted the appetite for riskier assets. Shares and certain global commodities were seen extending gains initially as markets expected some action by the leaders to doctor the financial health during the EU summit this week. Bullion declined, with spot gold shedding around one per cent after the euro slipped following the auction of Spanish short-term bills which saw a rise in yields and low off-take. However, investors were closely watching the developments in the euro zone for further directional cues.

However, moves by China to bolster economic growth and hopes of solid measures by EU to contain the debt crisis may cushion the fall. Crude oil turned lower following an initial rise during the morning trades after the Organization for Economic Cooperation and Development (OECD) trimmed the economic growth forecast for Euro area. Meanwhile, crude oil inventories in US were seen rising for the ninth consecutive week last week, which may probably build additional pressure over the oil market.

Crude oil prices are expected to fall today as forecast of rise in inventories along with a comfortable supply-side scenario will add to pressure on prices.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data May 22, 2012 actual v. forecast

Date	Time	Currency	Event	Actual	Forecast	Previous
May 22	04:00	NZD	Inflation Expectations (QoQ)	2.4%	2.5%
09:00	NOK	Norwegian GDP (QoQ)	1.4%	0.8%	0.6%
09:30	GBP	Core CPI (YoY)	2.1%	2.2%	2.5%
09:30	GBP	CPI (YoY)	3.0%	3.1%	3.5%
09:30	GBP	CPI (MoM)	0.6%	0.6%	0.3%

WEEKLY

• This Week in Petroleum
  Release Schedule: Wednesday @ 1:00 p.m. EST (schedule)
• Gasoline and Diesel Fuel Update
  Release Schedule: Monday between 4:00 and 5:00 p.m. EST (schedule)
• Weekly Petroleum Status Report
  Release Schedule: The wpsrsummary.pdf, overview.pdf, and Tables 1-14 in CSV and XLS formats, are released to the Web site after 10:30 a.m. (Eastern Time) on Wednesday. All other PDF and HTML files are released to the Web site after 1:00 p.m. (Eastern Time) on Wednesday. Appendix D is produced during the winter heating season, which extends from October through March of each year. For some weeks which include holidays, releases are delayed by one day. (schedule)

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

May 23	8:00	EUR	Current Account	-1.3B
	8:30	GBP	MPC Meeting Minutes	0-0-9
	TBD	EUR	Industrial New Orders m/m	-1.2%
	10:00	GBP	CBI Industrial Order Expectations	-8
	TBD	GBP	Inflation Report Hearings
	14:00	USD	New Home Sales	328K
	14:30	USD	Crude Oil Inventories
May 24	6:00	CHF	Trade Balance	1.69B
	7:00	EUR	French Flash Manufacturing PMI	46.9
	7:00	EUR	French Flash Services PMI	45.2
	7:30	EUR	German Flash Manufacturing PMI	46.2
	7:30	EUR	German Flash Services PMI	52.2
	8:00	EUR	German Ifo Business Climate	109.9
	8:00	EUR	Flash Manufacturing PMI	45.9
	8:00	EUR	Flash Services PMI	46.9
	8:30	GBP	Retail Sales m/m	1.8%
	8:30	GBP	Revised GDP q/q	-0.2%
	8:30	GBP	BBA Mortgage Approvals	31.9K
	8:30	GBP	Prelim Business Investment q/q	-3.3%
	12:30	USD	Unemployment Claims
	12:30	USD	Durable Goods Orders m/m	-4.0%
	13:00	EUR	Belgium NBB Business Climate	-10.7
May 25	6:00	EUR	GfK German Consumer Climate	5.6
	7:15	CHF	Employment Level	4.04M
	TBD	ALL	G8 Meetings
	13:55	USD	Revised UoM Consumer Sentiment

Click here a current Crude Oil Chart.

Originally posted here