Crude oil futures up as market awaits Fed Chair’s speech

Crude oil futures traded higher on Friday morning as the market awaited a speech by the US Federal Reserve Chair, Jerome Powell, later in the day for further guidance.

At 9.55 am on Friday, October Brent oil futures were at $77.30, up by 0.10 per cent, and October crude oil futures on WTI (West Texas Intermediate) were at $73.11, up by 0.14 per cent.

September crude oil futures were trading at ₹6,149 on Multi Commodity Exchange (MCX) during the initial hour of trading on Friday against the previous close of ₹6,158, down by 0.15 per cent, and October futures were trading at ₹6,113 against the previous close of ₹6,123, down by 0.16 per cent.

Powell is all set to address Jackson Hole symposium later in the day. In their Commodities Feed, ING Think’s Warren Patterson, Head of Commodities Strategy, and Ewa Manthey, Commodities Strategist, said the market participants will be focused on Fed Chair Powell’s speech at Jackson Hole later on Friday. “Markets are hoping that Powell sheds some more light on what the Fed may do at its September meeting. Although with a US jobs report still set to be released between Jackson Hole and the next FOMC, Powell may choose not to make too strong a statement,” they said.

Stating that oil prices staged a recovery on Thursday, they said this breaks a four-day streak of declines, which had pushed the market towards oversold territory.

They said OPEC+ will still be concerned about the recent weakness in the market. It is increasingly likely that the group will have to ditch plans to start increasing supply from October. However, this will depend on where the market is trading towards the end of September.

There was a downward trend in the crude oil market during week due to the demand concerns in the major markets.

Recent data showed a decline in the estimates of jobs added in the US between March 2023 and March 2024. This led to the concerns over a potential recession in the US. A recession could impact the demand for commodities such as crude oil. US is a major consumer of crude oil in the world market.

Latest data from China, another major consumer of crude oil, indicated a weak economic growth. It also highlighted the decline in demand for oil from refineries in China.

August zinc futures were trading at ₹267.90 on MCX during the initial hour of trading on Friday against the previous close of ₹265.30, up by 0.98 per cent.

On the National Commodities and Derivatives Exchange (NCDEX), September cottonseed oilcake contracts were trading at ₹3,356 in the initial hour of trading on Friday against the previous close of ₹3,315, up by 1.24 per cent.

October turmeric (farmer polished) futures were trading at ₹15,080 on NCDEX in the initial hour of trading on Friday against the previous close of ₹15,180, down by 0.66 per cent.