Crude oil futures traded higher on Wednesday morning as data from an industry body in the US showed a huge decline in crude oil inventories. The US is a major consumer of crude oil in the world market.
At 9.53 am on Wednesday, October Brent oil futures were at $85.67, up by 0.90 per cent, and September crude oil futures on WTI (West Texas Intermediate) were at $82.15, up by 0.96 per cent.
August crude oil futures were trading at ₹6,766 on the Multi Commodity Exchange (MCX) during initial trading, against the previous close of ₹6,727, up by 0.58 per cent, and September futures were trading at ₹6,739, against the previous close of ₹6,703, up by 0.54 per cent.
Stocks drop by 15.4 million barrels
According to the American Petroleum Institute, an industry body, crude oil inventories in the US declined by 15.4 million barrels for the week ending July 28, higher than the market expectations. The market was expecting the decline to be around 1.37 million barrels.
If official data from the US EIA (Energy Information Administration) confirms this data, it will be the biggest decline in crude oil inventories in the last four decades. US EIA is expected to release the weekly petroleum status report later in the day.
Meanwhile, major producers such as Saudi Arabia and Russia, have already announced production output cuts for August. Saudi Arabia is expected to extend the output cut to September.
Market reports that quoted a spokesperson from the US Energy Department said the US administration has withdrawn its offer to buy 6 million barrels of crude oil for its strategic petroleum reserves. This follows a likely increase in prices due to demand and supply tightness.
Jeera turns hot, Dhaniya cool
August zinc futures were trading at ₹225.45 on MCX in the initial trading hour of Wednesday morning, against the previous close of ₹226.70, down by 0.55 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), August jeera contracts were trading at ₹60,800 in the initial trading hour of Wednesday morning, against the previous close of ₹59,690, up by 1.86 per cent.
August dhaniya (coriander) futures were trading at ₹7,642 on NCDEX in the initial trading hour of Wednesday, morning against the previous close of ₹7690, down by 0.62 per cent.