Crude oil futures slip 1.73%, WTI trades below $38 a barrel

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Crude oil futures eased to Rs 2,824 per barrel on June 9 as participants increased their short positions. Prices fell after Saudi Prince Abdulaziz bin Salman said on June 8 that Saudi Arabia, United Arab Emirates (UAE) and Kuwait will not continue additional output cuts of 1.18 million barrels per day from July.

Putting additional pressure on black gold was ramp-up in output from US shale producers, refusal by Mexico to adhere to production and easing supply concerns relating to Libya amid peace talks, undercut the optimism.

Tapan Patel, Senior Analyst (Commodities), HDFC Securities, said crude oil prices pared previous gains on June 9 on concerns over non-compliance of the output cut deal among OPEC+ nations.

In the futures market, crude oil for June delivery touched an intraday high of Rs 2,928 and an intraday low of Rs 2,805 per barrel on the Multi-Commodity Exchange (MCX). So far in the current series, black gold has touched a low of Rs 1,361 and a high of Rs 4,415.

Crude oil futures for June delivery slipped Rs 50, or 1.73 percent, to Rs 2,832 per barrel at 15:06 hours IST on a business turnover of 4,534 lots.

The same for July delivery was down Rs 50, or 1.71 percent, to Rs 2,872 per barrel on a business volume of 321 lots.

The value of June and July contracts traded so far is Rs 1,710.47 crore and Rs 11.20 crore, respectively.

Patel expects oil prices to trade sideways to down for the day with support at $36 and resistance at $40. MCX June Crude Oil futures has support at Rs 2,750 and resistance at Rs 2,910."

West Texas Intermediate crude decreased 2.09 percent at $37.39 per barrel, while Brent crude, the London-based international benchmark, was down 1.57 percent to $40.16 per barrel.

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