Crude oil settled flat on saturday at 4968, but seems to be trading weak today as investors may sell for profits on reports France and Germany may be at odds concerning a timetable to centralize eurozone banking supervision, added pressure on crude seen by a firmer dollar and worries that weaker economic growth in key consumer nations will hurt global demand for oil. Meanwhile during the week prices can see support as a senior commander in Iran’s powerful Revolutionary Guard warned that Iran will target US bases in the region in the event of war with Israel, raising the prospect of a broader conflict that would force other countries to get involved. Iran has also warned that oil shipments through the strategic Strait of Hormuz will be in jeopardy if a war breaks out between Iran and the US. Israel believes that any attack on Iran would likely unleash retaliation in the form of Iranian missiles as well as rocket attacks by Iranian proxies Hezbollah and Hamas. Obama has rejected these calls, saying diplomacy and US led sanctions must be given more time and that Iran will never be allowed to obtain nuclear weapons. American officials have pressed Israel not to attack Iran unilaterally, a move that could set off regional mayhem just ahead of the November election. Now market is getting support at 4963 and below could see a test of 4959 level & resistance is now likely to be seen at 4973, a move above could see prices testing 4979.

Trading Ideas:

Crude trading range for the day is 4959-4979.

Crude gains as concerns about Libya's precarious security situation and lower production in North Sea triggered worries about supply.

OPEC member and Africa's third biggest producer Libya swiftly ramped up oil output after last year's revolution.

Iran threatens attacks on US bases in event of war