A sustained move under $53.61 will signal the existence of sellers which indicates a bull trap. This can trigger a labored break with potential targets coming in at $52.40, $51.29 and $50.66. If $50.66 fails as support arehorrified to find that the supplying extend into the main retracement zone at $50.28 to $48.83.

A sustained move over $54.00 will indicate the use of buyers. This will likely also indicate that Friday’s move was fueled by fake buying rather and merely buy stops. The upside momentum will not likely continue and testing $54.98 is really a pipe dream for buyers from fuelled trade talks.

Lifting Iranian sanctions have a significant effect on the globe 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 each day, causing them to be the second biggest producer in OPEC. Iran’s oil reserves account for approximately 10% with the world’s total proven petroleum reserves, with the rate in the 2006 production the reserves in Iran could last 98 years. Almost certainly Iran will prove to add about 2million barrels of oil each day for the market and based on the world bank this will likely resulted in the decline in the oil price by $10 per barrel pick up.

As outlined by Data from OPEC, at the beginning of 2013 the most important oil deposits come in Venezuela being 20% of global oil reserves, Saudi Arabia 18%, Canada 13% and Iran 9%. Due to the characteristics with the reserves it is not always possible to bring this oil on the surface because of the limitation on extraction technologies and the cost to extract.

As China’s increased requirement for gas as an option to fossil fuel further reduces overall demand for oil, the rise in supply from Iran along with the continuation Saudi Arabia putting more oil on top of the market should begin to see the price drop in the next 12 months plus some analysts are predicting prices will fall under the $30’s.

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