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Wednesday, August 10, 2022

India Crude:Down tracking NYMEX on firm dlr; eyes on OPEC Jun output

Informist, Tuesday, Jul 5, 2022


By Sayantan Sarkar


MUMBAI – Crude oil prices in India fell today, tracking early losses in benchmark contracts on international exchanges, as the dollar rose sharply against major currencies. 


* A stronger dollar makes oil more expensive for holders of other currencies, limiting demand. 


* Oil prices have been struggling to break out from the current range, as investors shift their focus to fears about a global recession. “WTI (West Texas Intermediate) looks the more vulnerable of the two, as recession nerves rachet up in the US,” Jeffery Halley, senior market analyst Asia Pacific, OANDA, said in a note. 


* At 1759 IST:

 –July contract on the Multi Commodity Exchange of India was down 1.0% at 8,638 rupees per bbl.

 –August contract on the New York Mercantile Exchange was up 0.4%% at $108.8 per bbl.


* However, a drop in production capacity of several member countries within the Organization of the Petroleum Exporting Countries has added to supply concerns in the market. According to several reports, OPEC’s production of crude in June was down significantly from the targets set by the cartel and its allies. 


* Supply disruptions in Libya and Norway continued to stretch the market, with Russia’s production falling sharply since several countries have imposed sanctions on Moscow. 


* In addition, record high driving activity was noted in the US ahead of the Fourth of July weekend, according to the American Automobile Association. The US is the world’s biggest consumer of crude oil. 


* Outlook for the evening session by HDFC Securities:

 –MCX contract is seen at 8,590-8,810 rupees per bbl

 –NYMEX contract is seen at $108-$112 per bbl 




US$1 = 79.37 rupees

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT


Edited by Avishek Dutta


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Source: Cogencis

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