Crude oil futures traded higher on Wednesday morning as the industry report showed a decline in inventory level in the US for the week ending July 26.
At 9.54 am on Wednesday, October Brent oil futures were at $79.31, up by 1.59 per cent, and September crude oil futures on WTI (West Texas Intermediate) were at $75.94, up by 1.62 per cent.
August crude oil futures were trading at ₹6374 on Multi Commodity Exchange (MCX) during the initial hour of trading on Wednesday against the previous close of ₹6292, up by 1.30 per cent, and September futures were trading at ₹6319 against the previous close of ₹6240, up by 1.27 per cent.
According to the industry body American Petroleum Institute (API), crude oil inventories in the US declined by 4.49 million barrels for the week ending July 26. API had reported a decline of 3.9 million barrels in the previous week.
Market is now waiting for the release of official data on crude oil inventories from the US EIA (Energy Information Administration) later in the day. US is a major consumer of crude oil in the world market.
Tensions in West Asia also supported the price of the commodity. Israel launched an airstrike on Beirut on Tuesday in retaliation to the Hezbollah attack on the Israeli-occupied Golan Heights. Reports said that one of the Hezbollah commanders was killed in this attack by Israeli forces. The recent Hezbollah attack on Golan Heights had led to the death of 12 children and teenagers.
Market is also waiting for the outcome of the meeting of Joint Ministerial Monitoring Committee of the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, on Thursday. Some media reports said the meeting is unlikely to major decisions on production despite the weakness in the prices of the commodity in the recent days.
Meanwhile, China failed to impress the markets once again as the latest manufacturing data showed decline in factory activities in that country.
According to the National Bureau of Statistics of China, manufacturing PMI (purchasing managers index) declined to 49.4 in July from 49.5 in the previous month. This is the third straight month of shrinking in factory activities.
China is the second largest consumer of crude oil in the world market after the US. The recent economic data from China have created apprehensions over the demand for the commodity in the international market.
August zinc futures were trading at ₹253.65 on MCX during the initial hour of trading on Wednesday against the previous close of ₹251.10, up by 1.02 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), August guarseed contracts were trading at ₹5529 in the initial hour of trading on Wednesday against the previous close of ₹5484, up by 0.82 per cent.
August castorseed futures were trading at ₹6131 on NCDEX in the initial hour of trading on Wednesday against the previous close of ₹6156, down by 0.41 per cent.