Crude drops to $63.91/bbl

Markets were already estimating a higher output cut and only then, they would have reacted. We would have seen a cut between 2-3 million barrel per daily basis and that is, when you would have seen some support into prices. But we have seen 11% of decline in crude prices in the last week; markets are really watching and waiting for OPEC to do some more action. Only then would you see some support.

At this point, the maximum action is seen at USD 50 per barrel. That is where most people are buying that option and a 142% increase in that contract activity was seen on Friday. The recession fears are still there, the demand is on the lower side: USD 64-65 per barrel range at this point is where you are looking at trades. But we saw a low of USD 62.45 per barrel on Friday. A very near-term range is seen between USD 58 per barrel on the lower side to USD 68 per barrel on the higher side.