Crudeoil settled down -0.38% at 6047 as downward spiral since last week continious after Libya reopened its largest oilfield following months of protests and the conflict in Iraq looked isolated to the north. However, this week we could see some support at $100 as supply interruption worries could be renewed. The Iraqi parliament has been working to form a new, more inclusive government in order to give minority groups a voice and cut their support for radical movements. However, on Sunday, the parliament said it was going to further delay its decision on the new government until Tuesday.

The conflict in Iraq also spread to the South, where the majority of the nation’s oil is exported. Renewed fighting in Libya also boosted Brent prices as investors worried that the nation’s efforts to ramp up exports and reopen oil fields would be short lived. Libya’s main airport was shut down on Sunday as militant groups fought among themselves for control of the airport.

Oil prices have been declining in the past weeks as Libya recently struck a deal with rebels occupying oil ports under terms that would have insurgents give up control over terminals that have been closed for a year. The deal should add
500kbls per day of crude back into the global energy market. Meanwhile, indications that Iraqi oil exports from the southern part of the country remained insulated from the sectarian violence that has swept the north in recent weeks also weighed. Technically market is under long liquidation and getting support at 6025 and below same could see a test of 6002 level, And resistance is now likely to be seen at 6072, a move above could see prices testing 6096.

Trading Ideas:

Crudeoil trading range for the day is 6002-6096.

Crude oil dropped on signs of improving supply from key producers and weak demand in some consuming centres.

Libya's oil output has continued to rise and has now reached 470,000 barrels per day (bpd).

Worries over potential supply disruptions in the Middle East continued to subside.