Crude oil futures traded lower on Thursday morning as the official data showed an increase in inventories in the US.

At 9.55 am on Thursday, August Brent oil futures were at $82.39, down by 0.25 per cent, and July crude oil futures on WTI (West Texas Intermediate) were at $78.32, down by 0.23 per cent.

June crude oil futures were trading at ₹6544 on Multi Commodity Exchange (MCX) during the initial hour of trading on Thursday morning against the previous close of ₹6577, down by 0.50 per cent, and July futures were trading at ₹6529 against the previous close of ₹6561, down by 0.49 per cent.

According to the US EIA (Energy Information Administration), there was an increase in crude oil inventories in the US for the week ending June 7.

US commercial crude oil inventories increased by 3.7 million barrels for the week ending June 7 from the previous week. At 459.7 million barrels, US crude oil inventories were about 4 per cent below the five-year average for this time of year.

Total motor gasoline inventories increased by 2.6 million barrels from last week and were slightly below the five-year average for this time of year.

Total products supplied in the US over the last four-week period averaged 19.8 million barrels a day, down by 0.8 per cent from the same period last year. Over the past four weeks, motor gasoline product supplied averaged 9.1 million barrels a day, down by 1.3 per cent from the same period last year.

US crude oil imports averaged 8.3 million barrels a day for the week ending June 7, an increase of 1.2 million barrels a day from the previous week. Over the past four weeks, crude oil imports averaged about 7.2 million barrels a day, 11.4 per cent more than the same four-week period last year.

IEA forecast

Meanwhile, International Energy Agency’s (IEA) Oil Market Report for June highlighted slow growth in world oil demand. It said that world oil demand growth continues to slow with 2024 gains now seen at 960,000 barrels a day, 100,000 barrels a day below last month’s forecast.

Weak OECD deliveries pushed global demand into a narrow year-on-year contraction in March. Subpar growth of 1 million barrels a day in 2025 is held back by a muted economy and accelerating clean energy technology deployment, it said.

Global oil supply rose by 520,000 barrels a day in May, as Brazilian ethanol output surged seasonally. For the year as a whole, production increases by 690,000 barrels a day, led by non-OPEC+ gains of 1.4 million barrels a day. OPEC+ supply falls by 740,000 barrels a day if voluntary cuts are maintained. In 2025, global supply is forecast to rise by 1.8 million barrels a day, as non-OPEC+ output increases by 1.5 million barrels a day, it said.

Fed meeting

Crude oil prices were also impacted by the decision of the US Federal Reserve to maintain the interest rates at the current level. Market now pins hopes for an interest rate cut in December.

Addressing a press conference after the end of the two-day meeting, the Chair of the US Federal Reserve, Jerome Powell, said inflation had fallen without a major blow to the economy. However, he said there was no reason to think that can’t go on.

Market reports said that a reduction in interest rates would have helped boost economic growth in the US. This, in turn, would have increased the demand for commodities such as crude oil in the market. High interest rates make crude oil costlier in the international market.

June aluminium futures were trading at ₹233.30 on MCX during the initial hour of trading on Thursday morning against the previous close of ₹235.50, down by 0.93 per cent.

On the National Commodities and Derivatives Exchange (NCDEX), June jeera contracts were trading at ₹29340 in the initial hour of trading on Thursday morning against the previous close of ₹28760, up by 2.02 per cent.

August turmeric (farmer polished) futures were trading at ₹17944 on NCDEX in the initial hour of trading on Thursday morning against the previous close of ₹17842, up by 0.57 per cent.

Related Topics