Crude oil futures traded slightly lower on June 28 as the price seesaw between gain and loss after touching fresh 52 weeks high during intraday on the MCX. The energy commodity surged Rs 202, or 3.81 percent last week on the domestic bourse.
On the MCX, crude oil delivery for July dipped Rs 10, or 0.18 percent, to Rs 5,493 per barrel at 16:09 hours IST with a business turnover of 9,259 lots. The delivery for August slipped Rs 8, or 0.15 percent to Rs 5,464 per barrel with a business volume of 438 lots.
The value of July and August’s contracts traded so far is Rs 385.26 crore and Rs 4.81 crore, respectively.
West Texas Intermediate (WTI) crude dropped 0.14 percent to $73.95 per barrel, while Brent crude, the London-based international benchmark, fell 0.31 percent to $75.15 per barrel.
“NYMEX crude trades in a narrow range above $74/bbl. Crude is rangebound amid positioning ahead of the OPEC meeting this week. OPEC is expected to raise output in light of rising demand but may reiterate its gradual stance. Support from lower US crude stocks, US economic optimism and Iran uncertainty is countered by mixed data, rising virus concerns and China’s commodity crackdown. Crude may remain sideways to positive ahead of OPEC decision this week” said Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities.
The number of rigs drilling crude oil in the US fell by 8 to 372 for the week to June 25, said Baker Hughes in a weekly report.
Market players await OPEC+ allies meeting on July 1 for further direction. The organization will discuss production policy for August as some member nations want to increase output.
According to CFTC data, hedge funds and other money managers cut their net long US crude futures and options positions by 6,135 contracts to 427,836 for the week to June 22.
The black gold has been trading higher than 5, 20, 50, 100 and 200 days' simple moving averages and exponential moving averages on a daily chart. The momentum indicator Relative Strength Index (RSI) is at 75.23, indicating some pullback in prices.
Tapan Patel- Senior Analyst (Commodities), HDFC Securities
Crude oil prices hovered near a resistance range of $74 per barrel on mixed global cues. Crude oil prices have kept firm trading on a strong demand outlook from the US ahead of summer driving season and higher demand from Europe with ease in lockdown measures. The speculation ahead of OPEC plus meeting this week may keep oil prices on edge for the short term.
Crude oil prices are expected to trade sideways to up for the day with resistance at $75 and support at $73 per barrel. MCX Crude oil July has support at Rs. 5420, resistance at Rs.5560.
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