Crudeoil yesterday settled up 0.31% at 6543 as prices trimmed earlier losses after industry data revealed the US service sector was busier in July than markets were expecting. Prices got support as supply risks from key producers such as Libya abate, but a forecast fall in crude stockpiles in the world's biggest oil consumer stemmed losses. Meanwhile China's HSBC Purchasing Managers' Index for the service-sector industry for July released earlier came in at 51.3, unchanged from June's reading. The official government reading for non-manufacturing PMI in July released over the weekend hit 54.1 compared with 53.9 in June. The numbers helped oil trim earlier losses stemming from Friday's lackluster US July jobs report. The Bureau of Labor Statistics reported earlier that the US economy added 162,000 jobs in July, missing expectations for an increase of around 189,000. The report also revealed that the US unemployment rate ticked down to 7.4% in July, from 7.6% the previous month. Also Political volatility in Libya, a member of the Organization of Petroleum Exporting Countries, has some traders believing oil could rise in the near-term. Combine that with lingering violence in Egypt, home of the Suez Canal, a major transport zone for oil, and oil could be ripe for a spike. However, any ebbing of tensions in the Middle East could prompt traders to take profits in oil and exit the trade. Libya is home to Africa's largest oil reserves. Three terminals, which ship 1 million barrels per day, are still not operative in the North African nation. Technically market is getting support at 6490 and below same could see a test of 6438 level, And resistance is now likely to be seen at 6577, a move above could see prices testing 6612.
Trading Ideas:
Crudeoil trading range for the day is 6438-6612.
Crude oil prices trimmed losses after industry data revealed the U. S. service sector was busier in July than markets were expecting.
Libyan Oil Minister Abdelbari al-Arusi told a news conference the country's oil output had improved to around 700,000 barrels per day
Output is also improving in the North Sea, with news that the Buzzard oilfield, Britain's largest, was expected to begin restarting later on schedule.
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