Crude oil futures traded higher on Tuesday morning following the reports of Chinese authorities planning measures to boost the communist nation’s economy.

At 9.54 am on Tuesday, October Brent oil futures were at $82.66, up by 0.22 per cent, and September crude oil futures on WTI (West Texas Intermediate) were at $78.97, up by 0.29 per cent.

August crude oil futures were trading at ₹6,453 on Multi Commodity Exchange (MCX) during initial trading against the previous close of ₹6,461, down by 0.12 per cent, and September futures were trading at ₹6,451 as against the previous close of ₹6,455, down by 0.06 per cent.

New difficulties, challenges

A report by the Chinese news agency Xinhua said the Political Bureau of the Communist Party of China (CPC) Central Committee on Monday conducted a meeting to analyse the current economic situation and make arrangements for economic work in the second half of the year.

The meeting, which was chaired by Xi Jinping, general secretary of the CPC Central Committee, called for carrying out macroeconomic regulation with precision and force, strengthening counter-cyclical regulation, and making more policy options available, it said.

According to the report, China’s economy is facing new difficulties and challenges, which mainly arise from insufficient domestic demand, difficulties in the operation of some enterprises, risks and hidden dangers in key areas, as well as a grim and complex external environment.

Buoying market

Seeking efforts to actively expand domestic demand and give play to the fundamental role of consumption in driving economic growth, the meeting stressed the need to encourage consumption of major items, including automobiles, electronic products and household items.

The outcome of the meeting has enthused the crude oil market, as China is a major buyer of crude oil in the world market. Measures to boost economy in that country will create demand for commodities such as crude oil in the world market.

Apart from the Chinese measures, the decision of OPEC (Organization of Petroleum Exporting Countries) and its allies, known as OPEC+, to reduce production output is also helping the crude oil market.

Dhaniya, guar gum decline

August natural gas futures were trading at ₹224.40 on MCX against the previous close of ₹221.50, up by 1.31 per cent.

On the National Commodities and Derivatives Exchange (NCDEX), August dhaniya contracts were trading at ₹7,800 against the previous close of ₹7,854, down by 0.69 per cent.

August guar gum futures were trading at ₹12,260 on NCDEX in the initial trading hour of Tuesday morning against the previous close of ₹12,286, down by 0.21 per cent.

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