Crude oil futures settled flat at Rs 3,527 per barrel on January 1 as participants trimmed their positions as seen by the open interest. Crude oil prices held steady range post inventory data as investors and traders refrained from taking large positions ahead of New Year weekend.
It ended the week with a loss of Rs 27 or 0.76 percent. Crude prices declined three out of the five trading sessions on the MCX.
The year 2020 was a roller coaster for crude oil as the price dropped into negative territory for the first time only to witness a sharp rebound later in the last two months on vaccine optimism but ended the year with a steep decline of 20 percent.
The US Energy Information Administration (EIA) reported that US crude inventories fell by 6.05 million barrels for the week ended December 25.
The number of rigs drilling crude oil in the US rose by 3 to 267 rigs for the week to December 31, said Baker Hughes in a weekly report. The rigs count rose for the sixth consecutive week.
“Crude oil prices hovered above $48 per barrel during the week with thin volumes over New Year holidays. Crude oil prices were supported by a weaker dollar and strong equity indices while worries over fuel demand recovery kept upside limited. The vaccine rollouts in some parts of the world and beginning of the emergency use of a vaccine in the US boosted prospects of oil demand recovery”, said Tapan Patel- Senior Analyst (Commodities), HDFC Securities.
MCX iCOMDEX Crude Oil Index inched marginally higher 3.42 points, or 0.09 percent, to close at 4,021.84.
In the futures market, crude oil for January delivery touched an intraday high of Rs 3,559 and an intraday low of Rs 3,511 per barrel on MCX. So far in the current series, black gold has touched a low of Rs 3,130 and a high of Rs 3,639.
Crude oil delivery for January gained Rs 3, or 0.09 percent, to end at Rs 3,527 per barrel with a business turnover of 1,096 lots.
The value of January’s contracts traded on January was Rs 49.60 crore.
Patel expects crude oil prices to trade with bullish bias in the coming week while prices are currently holding the trading range of $47-$50 per barrel. The breakout may lead crude oil price towards $53 per barrel with support at $46 per barrel. MCX Crude oil January contract has important support at Rs 3,360 and resistance at Rs 3,670 per barrel.
West Texas Intermediate crude rose 0.08 percent to settle at $48.44 per barrel, while Brent crude, the London-based international benchmark jumped 0.17 percent to close at $51.72 per barrel.
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