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Monday, November 28, 2022

India Crude: Hits over-1-month high as OPEC cuts supply by 2 mln bpd

Informist, Thursday, Oct 6, 2022


By Sayantan Sarkar


MUMBAI – Crude oil prices in India rose to an over-one-month-high today, tracking sharp gains in international contracts from Wednesday after the Organization of the Petroleum Exporting Countries and allies cut production substantially. 


* Indian markets were closed on Wednesday on account of Dussehra.


* OPEC and its allies agreed to cut production by 2 mln barrels per day in November to shore up oil prices. The cartel held an in-person ministerial-level meeting on Wednesday for the first time in over two years.


* The decision to cut production resulted in oil prices to rise to a three-week high on the New York Mercantile Exchange. The most active contract of oil on the Multi Commodity Exchange of India hit an over-one-month high of 7,246 rupees per bbl earlier today. 


* Also, supporting crude oil prices today was the crude oil inventory report by the Energy Information Administration, which showed that oil stockpiles, along with petrol and distillates, fell sharply in the US for the week ended Friday. 


* “Oil should remain supported here following the OPEC+ decision and the EIA report, but the upside will be capped well in advance of the $100 a barrel level,” Ed Moya, senior market analyst at OANDA, Americas, said in a report. 


* At 1725 IST:
 –October contract on the Multi Commodity Exchange of India was up 0.3% at 7,185 rupees per bbl.

 –November contract on the New York Mercantile Exchange was down 0.4% at $87.37 per bbl.


* Oil prices on international exchanges are currently in the red as investors booked profit after prices rose sharply on Wednesday. 


* Additionally, the US government is preparing to loosen sanctions on Venezuela and allow Chevron to resume pumping oil there, the Wall Street Journal reported today. The report comes at a time when Washington was clearly miffed with OPEC for agreeing to cut supplies steeply. US is the largest consumer of crude oil, and higher prices have kept domestic petroleum prices elevated throughout this year. 


* Outlook for the evening session by Angel One Commodities:
 –MCX contract is seen at 6,750-7,560 rupees per bbl
 –NYMEX contract is seen at $86.4-$89.3 per bbl



US$1 = 81.88 rupees

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


Edited by Deepshikha Bhardwaj


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Source: Cogencis

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