Crude oil prices traded under pressure on July 12 amid the prospect of slower demand growth due to surge in Delta variant cases and delayed OPEC plus nations’ decision over output quota. The energy commodity fell Rs 41, or 0.73 percent last week on the domestic bourse.
The black gold extended decline to trade at day’s low after a flat to gap-down start tracking the muted global trend.
On the MCX, crude oil delivery for July tanked Rs 78, or 1.40 percent, to Rs 5,476 per barrel at 16:10 hours IST with a business turnover of 5,450 lots. The delivery for August dropped Rs 77, or 1.39 percent to Rs 5,444 per barrel with a business volume of 977 lots.
The value of July and August’s contracts traded so far is Rs 923.06 crore and Rs 29.85 crore, respectively.
West Texas Intermediate (WTI) crude slipped 1.60 percent to $73.37 per barrel, while Brent crude, the London-based international benchmark, tumbled 1.55 percent to $74.38 per barrel.
“NYMEX crude trades around 1% lower near $73.9/bbl extending the fall from the early session today. Crude trades mixed as support from China’s monetary easing, choppy US dollar, stable equities and lower US crude stocks is countered by OPEC uncertainty, rising virus concerns and jump in US crude rig count to April 2020 highs. Crude oil is likely to remain volatile unless there is clarity from OPEC however rising virus concerns and the prospect of higher supply may keep pressure on price,” said Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities.
The CFTC data showed that money managers decreased their net long positions by 33686 lots in the last week.
The number of rigs drilling crude oil in the US rose by 2 to 378 for the week to July 8, said Baker Hughes in a weekly report.
The black gold has been trading higher than 5, 20, 50, 100 and 200 days' simple moving averages on the daily chart. The momentum indicator Relative Strength Index (RSI) is at 56.94, which suggest bullish movement in the prices.
Tapan Patel- Senior Analyst (Commodities), HDFC Securities
Crude oil prices declined on slower demand growth which underpinned tighter supply on stalled OPEC decision. The finance chiefs of the G20 large economies warned on Saturday that the spread of coronavirus variants and unequal access to vaccines has threatened the global economic recovery.
Crude oil prices are expected to trade sideways to down for the day with resistance at $75 and support at $72.80 per barrel. MCX Crude oil July has support at Rs 5,450, resistance at Rs 5,580.
For all commodities-related news, click hereDisclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.