Oil rig to fall soon - Brent and Ruble ready to rise
Russian Ruble has recently touched 4.5-month high, but the oil rebound gives the currency the hope to appreciate again. And the chances for oil surge are growing.
There are several factors that may affect oil moves from verbal interventions to the EIA stocks change data and oil rigs. We have already seen data from the EIA this week. The OPEC officials still keep silence. So, all we have is Baker Hughes data scheduled for release tonight.
Judging by the reports, the oil rig number has approximately 3-month lag when reacting to the oil moves. It means the current surge is triggered by the long-term period of oil appreciation seen since February, 2016. And the bearish trend came to an end 3 months ago. What’s interesting, the current number of oil rigs was last seen when Brent was around $80.00 bbl.
What does it mean? It means the oil rig number will soon reverse the trend. The current price levels are unfavorable for further rapid increase of output. And there is a chance to see the decrease of the Baker Hughes number today. For the first time during the last 5.5 months. And this will be enough to revive a demand on Brent sending it to 46.30 in the nearest future.
Under such scenario, USD/RUB may go back to 59.00 with next target at 58.60.
Helen Rush,
Senior Analyst at Capital Markets
There are several factors that may affect oil moves from verbal interventions to the EIA stocks change data and oil rigs. We have already seen data from the EIA this week. The OPEC officials still keep silence. So, all we have is Baker Hughes data scheduled for release tonight.
Judging by the reports, the oil rig number has approximately 3-month lag when reacting to the oil moves. It means the current surge is triggered by the long-term period of oil appreciation seen since February, 2016. And the bearish trend came to an end 3 months ago. What’s interesting, the current number of oil rigs was last seen when Brent was around $80.00 bbl.
What does it mean? It means the oil rig number will soon reverse the trend. The current price levels are unfavorable for further rapid increase of output. And there is a chance to see the decrease of the Baker Hughes number today. For the first time during the last 5.5 months. And this will be enough to revive a demand on Brent sending it to 46.30 in the nearest future.
Under such scenario, USD/RUB may go back to 59.00 with next target at 58.60.
Helen Rush,
Senior Analyst at Capital Markets