Informist, Monday, Nov 7, 2022
By Sayantan Sarkar
MUMBAI – Oil prices in India were higher today on concerns about tight supply and the impending complete ban on Russian energy supplies by the European Union. Experts believe that in the near-term prices are expected to remain high.
* Despite global growth concerns, markets chose to focus on supply tightness ahead of the EU sanctions on Russia from Dec 5, said Ravindra V. Rao, head of commodity research at Kotak Securities. “OPEC+ (The Organization of the Petroleum Exporting Countries and allies) production cut of crude by 2 mln barrels per day started from November has added to the bullish sentiment in oil prices,” he said.
* At 1937 IST:
–October contract on the Multi Commodity Exchange of India was up 0.2% at 7,570 rupees per bbl.
–November contract on the New York Mercantile Exchange was down 0.2% at $92.41 per bbl.
* Additionally, lower inventories in the US have also added to bullishness in oil. The strategic reserves in the US are now below 400 mln bbl–the lowest in nearly 40 years.
* Meanwhile, oil prices were under pressure earlier today due to renewed concerns that China will stick to its zero-tolerance approach to COVID-19, pushing back on speculation that the country would ease restrictions in the coming months. The country is the world’s biggest importer of crude oil.
* Outlook for the evening session by Kotak Securities:
–MCX contract is seen at 7,213-7,711 rupees per bbl
–NYMEX contract is seen at $87.75-$95.35 per bbl
US$1 = 81.92 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Maheswaran Parameswaran
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