Oil prices climbed Monday as investors considered possible disruptions to supply in Iran and Nigeria.
Crude Oil Fundamental Analysis Jan. 17, 2012, Forecast
The crude Oil futures contract for February delivery added 86 cents, or 0.9%, to $99.56 in electronic trade on the New York Mercantile Exchange.
Regular floor trading will resume on Tuesday, with U.S. markets closed for the Martin Luther King Jr. holiday on Monday.
Rising tension between Iran and the West over the country’s nuclear development has spurred price increases in the past year. The U.S. and its European allies suspect Iran of using the program to create atomic weapons. In retaliation to the Wests move to force Iran to abandon their nuclear program, Iran on Sunday reportedly warned Gulf states not to step in and produce more should its oil exports be reduced due to threatened U.S. and European Union sanctions.
The positive start to the trading week follows a 2.8% loss for oil last week, with prices pressured by a stronger dollar and an unexpected jump in U.S. oil inventories.
Supply concerns are expected to dominate in the days ahead.
On Monday, unions in Nigeria, Africa’s largest exporter of crude, suspended nationwide strikes after President Goodluck Jonathan offered to partially reinstate subsidies to curb gas costs and deployed troops to stop expanding protests, according to media reports.
Separately, OPEC on hiked its 2012 outlook for growth in global demand for oil, but also cautioned that its projection included a significant level of uncertainty given world economic instability, particularly in the euro region.
Until the Nigeria situation is sorted Crude Oil is a strong buy.
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Analysis and Recommendations:
Support and Resistance levels for tomorrow S: 99.6 99.69 99.75
R: 99.91 100.00 100.06
Originally posted here
