Crude oil futures traded a tad lower on global exchanges on Tuesday morning as various leaders expressed concerns over a possible worldwide recession at the Davos economic summit.
At 10.03 am on Tuesday, July Brent oil futures ruled at $112.68, up by 0.11 per cent, and July crude oil futures on WTI were at $109.60, down by 0.63 per cent.
June crude oil futures were trading at ₹8,512 on Multi Commodity Exchange (MCX) in the initial hour of Tuesday morning against the previous close of ₹8,543, down by 0.36 per cent, and July futures were trading at ₹8,333 against the previous close of ₹8,363, down by 0.36 per cent.
4 crises interwoven
Speaking at the summit, German Vice-Chancellor, Robert Habeck said the world has at least four crises that are interwoven. “We have high inflation, we have an energy crisis, we have food poverty, and we have a climate crisis. And we can't solve the problems if we concentrate on only one of the crises,” he said, adding: “But if none of the problems is solved, I’m really afraid we’re running into a global recession with tremendous effect, on global stability.”
IMF Managing Director Kristalina Georgieva said she did not expect a recession for major economies, but could not rule one out.
In spite of the concerns over the tight supply of crude oil, the likely demand revival from China provided support to crude oil prices. Shanghai, which was under lockdown for many weeks affecting the demand for crude oil in the global market, is getting ready to reopen now.
The high fuel prices have also created concerns in the market as such a development is likely to impact the demand for crude oil.
Quoting the head of Saudi Aramco, a Reuters report said the world is facing a major oil supply crunch as energy firms are afraid to invest in the sector as they face green energy pressures.
June natural gas futures were trading at ₹687.20 on MCX in the initial hour of Tuesday morning against the previous close of ₹675.10, up by 1.79 per cent.
Cottonseed oil cake gains
On the National Commodities and Derivatives Exchange (NCDEX), June cottonseed oilcake futures were trading at ₹2,838 in the initial hour of Tuesday morning against the previous close of ₹2,829, up by 0.32 per cent.
June steel long contracts were trading at ₹48,690 on NCDEX in the initial hour of Tuesday morning against the previous close of ₹49,910, down by 2.44 per cent.