Expect Crude to trade sideways with upward bias: Angel

Crude Oil: Nymex crude oil prices swung between gains and losses and managed to marginally appreciate by 0.1 percent in the last week. Crude oil prices increased taking cues from more than expected decline in US crude oil inventories, tensions in the Middle East along with weakness in the DX. Additionally, expectations that three storms are building in Caribbean Sea which will enter Gulf of Mexico coupled with weakness in the DX also supported upside in the prices. Crude oil prices touched a high of $98.29/bbl in the last week and closed at $96.15/bbl in the last trading session of the week. On the domestic bourses, prices traded on a flat note and closed at Rs.5,346/bbl on Friday after touching a high of Rs.5,425/bbl during the week. Appreciation in the Indian Rupee prevented upside in the crude oil prices on the MCX.

Natural Gas: On a weekly basis, Nymex natural gas prices declined by more than 1 percent on the back of fall in demand coupled with more than expected increase in US natural gas inventories. However, weakness in the DX cushioned sharp fall in the prices. Gas prices touched a low of $2.682/mmbtu during the week and closed at $2.703/mmbtu in the last trading session of the week. In the Indian markets prices declined by 0.6 percent and closed at Rs.151.90/mmbtu on Friday after touching an intra-day low of Rs.149.2/mmbtu in the last week.

Outlook: In today’s session we expect crude oil prices to trade sideways with upward bias owing to closure of some of the production in the Gulf of Mexico with likelihood of the Hurricane Isaac entering the region along with mixed trend in the DX. In the domestic market depreciation in the Indian rupee might act as a supportive factor for the MCX prices.

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