In the futures market, crude oil for September delivery touched an intraday high of Rs 2,880 and an intraday low of Rs 2,684 per barrel on MCX.
Crude oil futures plunged to Rs 2,693 per barrel on September 8 as participants increased their short position as seen by the open interest. Crude oil prices declined on concerns over demand recovery due to the coronavirus pandemic, end of US summer driving season and increasing tensions between the US and China.
The sell-off in crude oil prices intensified as the US market opened for trading after a Labour Day holiday, tracking firmness in the US dollar. The US Dollar Index, measured against a basket of six currencies, gained 0.66 percent to trade at 93.33, the highest since August 24.
Globally, COVID-19 cases surpassed 27.3 million, while deaths exceeded 892,000.
Sumeet Bagadia, executive director, Choice Broking said, “Crude Oil prices opened slightly lower during Monday's trading session and continued the downtrend throughout the day; price declined more than 4 percent to close at Rs 2,903 level. Moreover, NYMEX Crude Oil prices also slipped below $40 after Saudi announcement to cut OSP’s for most crude grades for October deliveries to support the demand.”
“NYMEX crude trades 8.22 percent lower near $36.50/bbl weighed down by mixed economic data, rising US-China tensions, rise in US crude oil rig count and Saudi’s move to cut prices for Asian customers. Crude may remain choppy amid mixed factors, but possibility of another decline in US crude oil stocks may keep prices supported near $38/bbl-37.90/bbl," said Ravindra Rao, VP- head commodity research at Kotak Securities.
In the futures market, crude oil for September delivery touched an intraday high of Rs 2,880 and an intraday low of Rs 2,684 per barrel on the MCX. So far in the current series, black gold has touched a low of Rs 2,684 and a high of Rs 3,285.
Crude oil delivery for September slipped Rs 209, or 7.21 percent, to Rs 2,690 per barrel at 20:22 hours IST with a business turnover of 4,317 lots.
Crude oil delivery for October declined Rs 203, or 6.91 percent, to Rs 2,736 per barrel with a business volume of 213 lots.
The value of September and October’s contracts traded so far is Rs 2,370.37 crore and Rs 41.33 crore, respectively.
On the daily timeframe, MCX Crude Oil prices have been falling sharply from the last couple of days after a long consolidation. Price has sustained below 100 days Exponential Moving Averages (EMA) and lower band of Bollinger formation, which indicates southward movement in the counter in the near term. Hence, we expect crude prices may fall further towards the level of 2750, said Bagadia.
West Texas Intermediate (WTI) crude fell 8.80 percent at $36.27 per barrel, while Brent crude, the London-based international benchmark was down 6.19 percent to $39.41 per barrel.For all commodities related news, click here