Crude Oil
Nymex crude oil prices increased around 1.8 percent yesterday on the
back of expectations of rise in demand for the fuel after favorable
consumer confidence data from the US coupled with cool winter weather
conditions. Further, decline in API distillate inventories also
supported an upside in the prices.
However, rise in API crude oil and gasoline inventories along with
strength in the DX could not pull downside in the oil prices. Crude oil
prices touched an intra-day high of $97.66/bbl and closed at $97.41/bbl
in yesterday’s trading session.
On the domestic bourses, prices gained around 0.7 percent and closed at
Rs.6133/bbl after touching an intra-day high of Rs.6154/bbl on Tuesday.
Sharp upside in the prices was prevented due to appreciation in the
Rupee.
API Inventories Data
As per the American Petroleum Institute (API) report last night, US
crude oil inventories rose more than expected by 4.7 million barrels to
360.40 million barrels for the week ending on 24th January 2014.
Gasoline inventories rose by 363,000 barrels to 235.18 million barrels
and whereas distillate inventories declined by 1.8 million barrels to
116.40 million barrels for the same week.
EIA Inventories Forecast
The US Energy Department (EIA) is scheduled to release its weekly
inventories report today at 9:00pm IST and US crude oil inventories is
expected to gain by 2.3 million barrels for the week ending on 24th
January 2013. Gasoline stocks are expected to gain by 1.1 million
barrels whereas distillate inventories are expected to plunge by 2.2
million barrels for the same period.
Outlook
From the intra-day perspective, we expect crude oil prices to trade on a
mixed note on the back of expectations of rise in demand for the fuel
after favorable consumer confidence data from the US in yesterday’s
trade. Further, cool winter weather conditions coupled with decline in
distillate inventories from API and estimates of fall in US distillate
inventories will also support an upside in the prices. While on the
other hand, expectations of rise is US crude oil inventories along with
increase in API inventories yesterday will exert downside pressure on
the prices. Also, investors will remain cautious ahead of the Federal
Reserve meeting today which will act as a negative factor. In the Indian
markets, Rupee appreciation will cap sharp gains or even reversal in
the prices.
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