Crude Oil Set For Higher Open on Tuesday

August crude oil closed higher on Monday as it extends the rebound off last week's low. The high range close sets the stage for a steady to higher opening on Tuesday.

Stochastics and the RSI are turning bullish signaling that sideways to higher prices are possible near term. Closes above the reaction high crossing at 72.85 are needed to confirm that a short term low has been posted.

If August renews last week's decline, the 38% retracement level of this spring's rally crossing at 62.25 is the next downside target.

First resistance is today's high crossing at 71.92
Second resistance is the reaction high crossing at 72.85

First support is last Tuesday's low crossing at 66.37
Second support is the 38% retracement level of this spring's rally crossing at 62.25

Oil Settles Above $71, China to Boost Reserves

Oil prices settled above $71 a barrel Monday, as China said it would boost oil reserves and Nigerian militants partly shut down an offshore oil platform belonging to Royal Dutch Shell PLC. Benchmark crude for August delivery gained $2.33 to settle at $71.49 a barrel on the New York Mercantile Exchange. Alaron Trading Corp. analyst Phil Flynn said China's plans to increase its strategic crude oil reserves by 60 percent should provide the market with some long term support.....Complete Story

Kurds Blame Baghdad For Oil Delays

The construction of four oil refineries in the Kurdish region of Iraq was delayed because of the failures of the Iraqi oil minister, Kurdish lawmakers say. Refineries in the cities of Kirkuk and Erbil, the Kurdish capital, would have produced nearly 200,000 barrels per day while another plant should have been slated at the Taq Taq field, the Kurdish Globe reports. Those projects were delayed due to the negligence of Iraqi Oil Minister Hussain al-Shahristani.....Complete Story

Enterprise Products to Buy Teppco for $3.3 Billion

Enterprise Products Partners LP agreed to buy Teppco Partners LP for about $3.3 billion, combining pipeline operators controlled by Houston billionaire Dan Duncan to create the biggest U.S. energy partnership. Teppco owners will get 1.24 units of Enterprise for each of their units, a deal worth 15 percent more than when an initial offer was made in March, according to a statement today by the partnerships. The transaction is worth $31.36 per unit.....Complete Story

Natural Gas Trading Below 20 Day Moving Average

Natural gas is trading slightly lower, under 4.00, as it consolidates below the 20 day moving average crossing at 4.10. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices are possible near term.

If August extends last week's decline, the reaction low crossing at 3.710 is the next downside target. Closes above the 10 day moving average crossing at 4.135 would temper the near term bearish outlook in the market.

Monday's pivot point for natural gas is 4.06

First resistance is the 20 day moving average crossing at 4.10
Second resistance is the 10 day moving average crossing at 4.14

First support is last Wednesday's low crossing at 3.87
Second support is the reaction low crossing at 3.71

Oil, Gasoline Rise as Nigerian Militants Attack Shell Field

Crude oil and gasoline rose after an attack by Nigerian militants shut a field operated by Royal Dutch Shell Plc, cutting output from Africa’s largest producer. Shell said it closed the Estuary field near the Forcados export terminal after the assaults. Hostilities in the Niger River delta have cut more than 20 percent of the country’s oil exports since 2006. The International Energy Agency, an adviser to 28 developed nations, lowered its five-year forecast.....Complete Story

U.S. States Consider Gas and Oil Levies

Cash strapped states are considering raising taxes on oil production to plug yawning budget gaps, but they face strong resistance from oil companies, which warn the moves could lead to lost jobs and higher energy prices. Lawmakers in Pennsylvania and California have proposed what are known as severance taxes on oil and natural gas produced in their states. A tax increase took effect in Arkansas at the beginning of the year, and Alaska last year raised its oil production tax.....Complete Story

Chevron's $27 Billion Problem

Sometime later this year a judge in the sleepy Ecuadoran town of Lago Agrio is likely to sock Chevron Corp. with as much as $27 billion in damages over pollution left over from oil drilling by Chevron's Texaco unit in the 1970s and 1980s. The funny part is, Chevron (CVX-news-people) wanted it this way. When the case was originally filed in New York in 1993, Texaco, then an independent company, argued it would be fairer to hear it in Ecuador.....Complete Story

Crude Oil Hints at Sideways Trading This Week

August crude oil was higher overnight due to light short covering but remains below the 20 day moving average crossing at 70.20. Stochastics and the RSI are turning bullish hinting that sideways to higher prices are possible near term.

Closes above the 20 day moving average crossing at 70.20 are needed to confirm that a short term low has been posted. If August renews last Monday's decline, the 38% retracement of this spring's rally crossing at 62.25 is the next downside target.

Mondays' pivot point, our line in the sand is 69.75

First resistance is the 20 day moving average crossing at 70.20
Second resistance is the reaction high crossing at 71.29

First support is last Tuesday's low crossing at 66.37
Second support is the 38% retracement level at 62.25

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