Crude oil futures slip, but set for weekly gain

Crude oil futures traded lower on Friday morning due to profit booking by traders after a good week.

At 9:54 a.m. on Friday, August Brent oil futures were at $82.39, down by 0.44 per cent, and July crude oil futures on WTI (West Texas Intermediate) were at $78.19, down by 0.55 per cent.

June crude oil futures were trading at ₹6529 on Multi Commodity Exchange (MCX) during initial trading on Friday morning against the previous close of ₹6568, down by 0.59 per cent, and July futures were trading at ₹6514 against the previous close of ₹6550, down by 0.55 per cent.

Global demand reports

Despite traders booking some profits, futures were all set to gain more than 3 per cent this week. Although the US Federal Reserve decided to keep interest rates unchanged in its meeting this week, this decision did not have much impact on the weekly gains, following reports from some international agencies about strong global demand for the commodity during the year.

US Energy Information Administration’s (EIA) short-term energy outlook, released during the week, said that global consumption would increase by 1.1 million barrels a day in 2024 and 1.5 million barrels a day in 2025. “The growth in non-OECD consumption is led by China and India, which we expect will increase consumption by a combined 0.6 million barrels a day in 2024 and 0.7 million barrels a day in 2025,” it said.

The Monthly Oil Market Report of the Organization of the Petroleum Exporting Countries and Allies, known as OPEC+, also released this week, said that the global oil demand growth forecast for 2024 remained unchanged from last month’s estimates at 2.2 million barrels a day.

Meanwhile, Russia has said it will meet the production output target fixed by OPEC+. However, it said it exceeded the target set by OPEC+ in May. In a statement, the Russian Energy Ministry said the issue of overproduction would be resolved in June, and targeted levels would be achieved. Russia is a major crude oil producer in the global market.

On the market outlook, Prathamesh Mallya, DVP—Research, Non-Agri Commodities and Currencies, Angel One Ltd, said crude prices are expected to remain elevated due to ongoing tensions in West Asia and the Federal Reserve’s cautious sentiment on future rate cuts.

Jeera dips, cottonseed oilcake up

June natural gas futures were trading at ₹245.30 on MCX, down 1.05 per cent from the previous close of ₹247.90.

On the National Commodities and Derivatives Exchange (NCDEX), July jeera contracts were trading at ₹27,325 against the previous close of ₹27,670, down by 1.25 per cent.

June cottonseed oilcake futures were trading at ₹2700 on NCDEX, up 2.23 per cent from the previous close of ₹2641.

--EOM--