Crude oil futures traded lower on Wednesday morning despite China’s plans to support economic growth in that country.
At 9.54 am on Wednesday, September Brent oil futures were at $79.39, down by 0.30 per cent, and September crude oil futures on WTI (West Texas Intermediate) were at $75.33, down by 0.44 per cent.
July crude oil futures were trading at ₹6194 on the Multi Commodity Exchange (MCX) during initial trading, against the previous close of ₹6221, down by 0.43 per cent, and August futures were trading at ₹6197, as against the previous close of ₹6224, down by 0.43 per cent.
Stabilising bulk commodity consumption
Quoting Jin Xiandong, an official from the National Development and Reform Commission (NDRC) of China, a Reuters report said the persistent economic recovery faces difficulties and challenges of “insufficient demand, weak momentum and weak confidence”.
Stating that consumers’ purchasing power and consumption expectations are relatively weak, the official said the infrastructure and consumption environment need to be improved.
NDRC would formulate and roll out policies to restore and expand consumption, Jin Xiandong said, adding: “Focusing on stabilising bulk commodity consumption, improving automobile and electronics consumption, as well as optimising the consumption environment, we will introduce a batch of practical and effective policies and improve their implementation as soon as possible.”
Weak economic growth in China, a major buyer of crude oil in the world market, has been impacting the prices.
Meanwhile, an industry body reported a decline in US crude oil inventories . According to the American Petroleum Institute, crude oil inventories declined by 0.8 million barrels for the week ending July 14, against an increase of 3.02 million barrels in the previous week.
Also read: Crude Check: Crude oil bullish above ₹6,200
However, official data from the US EIA (Energy Information Administration) is expected later in the day.
Jeera, guar gum head south
July natural gas futures were trading at ₹215.90 on the MCX in the initial trading hour of Wednesday morning, against the previous close of ₹216.80, down by 0.42 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), July jeera contracts were trading at ₹59,400 in the initial trading hour of Wednesday morning, against the previous close of ₹60,765, down by 2.25 per cent.
August guar gum futures were trading at ₹11,429 on NCDEX in the initial trading hour of Wednesday morning, against the previous close of ₹11,517, down by 0.76 per cent.