Crude oil futures traded higher on Thursday morning as the industry data showed decline in inventories in the US for the week ending August 30.
At 9.54 am on Thursday, November Brent oil futures were at $72.94, up by 0.33 per cent, and October crude oil futures on WTI (West Texas Intermediate) were at $69.41, up by 0.30 per cent.
September crude oil futures were trading at ₹5,852 on Multi Commodity Exchange (MCX) during the initial hour of trading on Thursday against the previous close of ₹5,851, up by 0.02 per cent, and October futures were trading at ₹5,830 against the previous close of ₹5,825, up by 0.09 per cent.
According to the American Petroleum Institute (API), crude oil inventories declined by 7.4 million barrels for the week ending August 30. This number was much above the market expectations of a decline of 0.90 million barrels.
In their Commodities Feed, ING Think’s Warren Patterson, Head of Commodities Strategy, and Ewa Manthey, Commodities Strategist, said the API numbers released overnight were constructive. US crude oil inventories are estimated to have fallen by 7.4 million barrels over the last week, while refined products also saw small stock declines. Gasoline and distillate inventories fell by 300,000 barrels and 400,000 barrels, respectively. EIA weekly data will be released later on Thursday and a similar crude oil number would be the largest weekly decline since late June, they said.
Stating that crude oil prices continued their move lower on Wednesday, they said while ICE Brent settled a little more than 1.4 per cent lower on the day, NYMEX WTI settled below $70 a barrel for the first time since December.
“The continued weakness comes despite reports that OPEC+ is looking to delay its supply increase scheduled for October. Clearly, lingering demand worries outweigh any potential delay in this supply increase. If these reports turn out to be correct, the next key question is how long the group will delay their supply increases. The oil balance is in surplus through 2025 (assuming OPEC+ increases supply) and so continuing cuts into 2025 might make sense,” they said.
Citing four unnamed sources, a Reuters report said on Wednesday that OPEC+ (Organization of the Petroleum Exporting Countries and its allies) is discussing delaying an oil output increase scheduled to start in October after oil prices hit their lowest in nine months.
Reuters had recently reported that OPEC+ was set to proceed with 180,000 barrels a day production output increase in October, part of a plan to gradually unwind its most recent cuts.
September zinc futures were trading at ₹259 on MCX during the initial hour of trading on Thursday against the previous close of ₹261.50, down by 0.96 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), October jeera contracts were trading at ₹25,045 in the initial hour of trading on Thursday against the previous close of ₹24,890, up by 0.62 per cent.
September cottonseed oilcake futures were trading at ₹3,579 on NCDEX in the initial hour of trading on Thursday against the previous close of ₹3,593, down by 0.39 per cent.