Crude may trade on a range bound note today: Angel

Crude Oil: Nymex crude oil prices declined around 1 percent yesterday taking cues from rise in Spanish bond yields which will lead to curb in demand for the fuel. Additionally, a stronger DX also acted as a negative factor for the commodity. Crude oil prices touched an intra-day low of $83.27/bbl and closed at $83.30/bbl in yesterday’s trading session. On the domestic front, prices declined by 0.2 percent and closed at Rs.4,655/bbl after touching an intra-day low of Rs.4,604/bbl on Monday. However, depreciation in the Indian Rupee cushioned further fall in crude oil prices.

API Inventories Forecast: The American Petroleum Institute (API) is scheduled to release its weekly inventories today and US crude oil inventories are expected to decline by 1.0 million barrels for the week ending on 15th June 2012. Gasoline stocks are expected to increase by 1 million barrels and distillate inventories are also expected to gain by 1.2 million barrels for the same week.

News: International talks with Iran will take place today in Moscow over the country’s nuclear program. US President Barack Obama along with Russian President Vladimir Putin agreed yesterday at Group of 20 summit in Mexico that there is still time and space for a diplomatic decision on tensions over Iran’s potential development of nuclear weapons.

Enbridge Inc which holds the seaway pipeline is expected to boost its capacity to 400,000 barrels a day by end of 2012 from current 150,000 barrels a day.

Outlook: We expect crude oil prices, to trade on a range bound note today due to negative global market sentiments coupled with strength in the DX. While on the other hand US crude oil inventories are expected to decline which will support upside in prices.

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