Crude oil futures traded lower on Thursday morning as the market is waiting for the release of GDP data in the US later in the day.
At 9.57 am on Thursday, September Brent oil futures were at $81.11, down by 0.73 per cent, and September crude oil futures on WTI (West Texas Intermediate) were at $77, down by 0.76 per cent.
August crude oil futures were trading at ₹6457 on Multi Commodity Exchange (MCX) during the initial hour of trading on Thursday against the previous close of ₹6521, down by 0.98 per cent, and September futures were trading at ₹6406 against the previous close of ₹6457, down by 0.79 per cent.
Market is waiting for more signals as the US GDP data will be released later in the day. It will give an idea whether the US economy is cooling. Any such development could impact the demand for the commodities such as crude oil.
PCE price index data will be released on Friday. US Federal Reserve will consider this data in its outlook on interest rates.
The US Federal Reserve will meet next week. Market players feel that the Fed will keep interest rates unchanged. A majority in the market are of the opinion that the Fed may reduce interest rates in its September meeting. A reduction in interest rates will help boost the demand for commodities such as crude oil.
Concerns over demand in China also impacted the price of the commodity. China’s oil imports declined in June. China is a major crude oil importer.
On Thursday, People’s Bank of China decreased the one-year medium-term lending facility rate by 20 basis points to 2.3 per cent from 2.5 per cent. A few days ago, China had reduced the short-term lending rate. These measures are aimed at boosting the economy of that country.
However, the decline in crude oil inventories for the week ending July 19 offered some support to the crude oil prices.
According to the US EIA (Energy Information Administration), US commercial crude oil inventories decreased by 3.7 million barrels for the week ending July 19. At 436.5 million barrels, US crude oil inventories were about 5 per cent below the five-year average for this time of year.
Total motor gasoline inventories decreased by 5.6 million barrels from last week and were about 2 per cent below the five-year average for this time of year.
Total products supplied in the US over the last four-week period averaged 20.6 million barrels a day, up by 0.4 per cent from the same period last year. Over the past four weeks, motor gasoline product supplied averaged 9.3 million barrels a day, up by 2.5 per cent from the same period last year.
US crude oil imports averaged 6.9 million barrels a day last week, a decrease of 166,000 barrels a day from the previous week. Over the past four weeks, crude oil imports averaged about 6.8 million barrels a day, 2.9 per cent more than the same four-week period last year.
August zinc futures were trading at ₹249.15 on MCX during the initial hour of trading on Thursday against the previous close of ₹253.50, down by 1.72 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), August jeera contracts were trading at ₹26250 in the initial hour of trading on Thursday against the previous close of ₹26080, up by 0.65 per cent.
August guarseed futures were trading at ₹5434 on NCDEX in the initial hour of trading on Thursday against the previous close of ₹5412, up by 0.41 per cent.