Crude rose sharply after the government's oil inventory report showed crude oil and distillate supplies fell much more than expected last week. The U. S. Energy Information Administration's weekly oil inventory report showed crude oil supplies fell 3.7 million barrels in the week to Dec. 11.

OPEC will need to produce 28.61 million barrels a day to satisfy demand in 2010. That’s about 100,000 barrels a day more than last month’s projection and represents an increase of 30,000 barrels a day from 2009, the first annual gain in three years. Now support for the crude is seen at 3328 and below could see a test of 3255. Resistance is now likely to be seen at 3445, a move above could see prices testing 3489.

Trading Ideas:

CRUDE TRADING RANGE IS 3330-3470.

CRUDE ROSE SHARPLY AFTER THE OIL INVENTORY FELL MUCH MORE THAN EXPECTED

BUY CRUDE DEC ABV 3440 SL 3416 TGT 3468-3490-3522. MCX

CRUDE YESTERDAY AS PER EXPECTATION JUMPED TOWARDS 3400 LEVEL STILL LOOKING TILL 3450.

THE EIA WEEKLY REPORT SHOWED CRUDE OIL SUPPLIES FELL 3.7 MILLION BARRELS