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Crude oil crashes over 4% as US pipeline reopens, extended lockdown in India hurts demand

The momentum indicator Relative Strength Index (RSI) is at 48.48, indicating weak movement in prices.

May 13, 2021 / 10:46 PM IST

Crude oil futures plunged as growing coronavirus cases in India forced many states to extend lockdown to contain the spread of virus, thus dampening fuel demand in the world's third-largest oil consuming country. That apart, reopening of Colonial Pipeline after it was temporarily halted due to cyber attack last week, too, added pressure on the price.

On the MCX, Crude oil delivery for May plunged Rs 214, or 4.38 percent, to Rs 4,670 per barrel at 22:13 hours IST with a business turnover of 6,892 lots. While delivery for June slid Rs 216, or 4.40 percent to Rs 4,696 per barrel with a business volume of 2,491 lots.

The value of May and June’s contracts traded so far is Rs 2,909.79 crore and Rs 443.19 crore, respectively.

West Texas Intermediate crude was down 3.87 percent to $63.52 per barrel, while Brent crude, the London-based international benchmark declined 3.51 percent to $66.89 per barrel.

The US Energy Information Administration (EIA) reported that US crude oil inventories fell by 427,000 barrels for the week ended May 7 against analysts' expectation of 2.81 million barrels draw.

Close

The CFTC data showed that long positions in Crude oil futures rose by 8,431 to 662,720 contracts from the previous week.

Technicals

The black gold has been trading higher than 50, 100 and 200 days' moving averages but lower than the 5 and 20 days’ moving averages on a daily chart. The momentum indicator Relative Strength Index (RSI) is at 48.48, indicating weak movement in prices.

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