Crude oil futures tumbled to Rs 4,579 per barrel on April 26 on worries over fuel demand recovery despite upbeat economic data from Europe and the US.
The energy commodity extended decline after starting trade at the day’s low in the afternoon session tracking the negative global trend.
Crude prices have been trading higher than 20, 50, 100 and 200 days' moving averages but lower than the 5-day moving averages on a daily chart. The momentum indicator Relative Strength Index (RSI) was at 51.10 indicating sideways movement in prices.
Until the end of March, India's refinery run rate remained robust. The average run for all categories of refineries in India rose to 99 percent in March, better than 97 percent in February, the latest survey of the oil ministry showed. "We could see run rates in India easing to some extent in April and beyond, given the increase in the number of pockets witnessing lockdowns and rising infection numbers," said Alex Yap, senior oil analyst at S&P Global Platts Analytics.
The number of rigs drilling crude oil in the US fell by 1 at 343 rigs for the week to April 23, said energy services firm Baker Hughes in a weekly report.
The CFTC data showed that money managers decreased their net long positions by 4,455 lots in the last week.
Tapan Patel- Senior Analyst (Commodities), HDFC securities said, “Crude oil prices witnessed selling on mixed fundamentals as investors weighed on demand growth worries amid rising cases in top oil consumers like India and Japan. Crude oil prices are trading under pressure undermining strong economic data from the US over rising inventories and weaker demand.”
“NYMEX crude trades lower by almost 1 percent near $61.3 per barrel. Crude is range-bound as support from the upbeat US and European manufacturing PMI data, weakness in US dollar, and supply concerns relating to Libya are offset by rising virus cases and the prospect of higher supply from OPEC, the US, and Iran. Crude may remain in a range ahead of OPEC+ meeting later this week but general bias may be on the downside amid rising virus,” said Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities.
West Texas Intermediate crude slides 1.75 percent to $61.05 per barrel, while Brent crude, the London-based international benchmark dropped 1.77 percent to $64.26 per barrel.
MCX iCOMDEX Crude Oil Index decreased 80.61 points, or 1.55 percent, at 5,127.65 at 15:44.
In the futures market, crude oil for May delivery touched an intraday high of Rs 4,658 and an intraday low of Rs 4,565 per barrel on MCX. So far in the current series, black gold has touched a low of Rs 4,219 and a high of Rs 4,847.
Crude oil delivery for May slipped Rs 73, or 1.57 percent, to Rs 4,579 per barrel at 15:46 hours IST with a business turnover of 6,056 lots.
Crude oil delivery for June edged lower Rs 73, or 1.56 percent to Rs 4,595 per barrel with a business volume of 194 lots.
The value of May and June’s contracts traded so far is Rs 1,120.02 crore and Rs 9.56 crore, respectively.
Tapan Patel- Senior Analyst (Commodities), HDFC Securities
Crude oil prices witnessed selling on worries over fuel demand recovery. The rising virus cases in India have raised concerns over fuel consumption from the top oil importer. The state emergency in Japan has also dented a demand growth outlook pressuring oil prices.
Crude oil prices are expected to trade sideways to down for the day with resistance at $63 and support at $60 per barrel. MCX Crude oil May has support at Rs 4,520, resistance at Rs 4,650.
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