Market Watcher Flags Oil Buy Signal

Market Watcher Flags Oil Buy Signal
Rigzone's regular energy prognosticators take a look at technical pricing aspects of West Texas Intermediate oil, weather patterns in August, refinery maintenance implications and more.

(The views and opinions expressed in this article are those of the attributed sources and do not necessarily reflect the position of Rigzone or the author)

In this week’s preview of what to watch in oil and gas markets, Rigzone’s regular energy prognosticators take a look at technical pricing aspects of West Texas Intermediate (WTI) oil, weather patterns in August, refinery maintenance implications and more. Read on below to find out the specifics.

Rigzone: What developments/trends will you be on the lookout for this week?

Tom Seng, Director – School of Energy Economics, Policy and Commerce, University of Tulsa’s Collins College of Business: Technical analysts are pointing to the fact that WTI has traded below its 200-day Moving Average as proof of the continuation of lower prices. However, prices have pierced the lower Bollinger Band, a statistical indicator of variance from two Standard Deviations. That is a buy signal. The market will also be watching the weather to see if the widespread heat spell will abate much during August. That has been the primary driver of natural gas prices since we are tapped-out on our LNG export capabilities.

Hillary Stevenson, Director, Industry Relations at oil and gas data firm Validere: Will be watching to see when refinery maintenance starts to impact runs. Last week utilization was down to 91 percent. Utilization typically drops into the 80s in late September/early-October for fall turnarounds. Any unplanned outages due to storms or electricity loss could send rates lower sooner. Lower refinery utilization rates would pressure crude prices lower. 

To contact the author, email andreas.exarheas@rigzone.com



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