Crude oil futures witnessed a mixed trend on Wednesday on expectations of more supply from Venezuela, and the likely demand recovery for the energy commodity with China’s plans to ease Covid restrictions.
At 10.05 am on Wednesday, July Brent oil futures were at $112.40, down by 1.61 per cent, and July crude oil futures on WTI were at $110.35, up by 0.66 per cent.
May crude oil futures were trading at ₹8,763 on Multi Commodity Exchange (MCX) in the initial hour of Wednesday morning against the previous close of ₹8,849, down by 0.97 per cent, and June futures were trading at ₹8,558 against the previous close of ₹8,653, down by 1.10 per cent.
There were reports that the US has allowed Chevron Corp to negotiate oil licences with Venezuela to maintain its operations and to negotiate future business. Market reports noted that the US has temporarily lifted the ban on such discussions. Any additional supply of crude oil will help ease the tight supply condition in the global markets.
Shanghai set to end lockdown
With reduction in Covid cases, Shanghai region in China is planning to end lockdown. The region was under the lockdown almost for a month-and-a-half. The lockdown had affected the demand as China is a major consumer of crude oil globally.
While the US Energy Information Administration (EIA) is set to release data on the weekly petroleum status report later in the day, market reports, citing the American Petroleum Institute, said the crude oil and gasoline stocks in the US fell in the last week. They noted that this was one of the reasons for Brent crude settled below WTI crude for the first time since May 2020.
Meanwhile, European Union (EU) is yet to take a unanimous decision on imposing a total ban on the import of crude oil from Russia due to its war with Ukraine.
Hungary, one of the members of EU, has not agreed for such a ban as it would impact its economy. Market reports noted that the proposed summit of EU on May 30-31 may pave the way for imposing a total ban on the import of crude oil from Russia.
May cotton futures were trading at ₹49,570 on MCX in the initial hour of Wednesday morning against the previous close of ₹49,350, up by 0.45 per cent.
Castor seed slips
On the National Commodities and Derivatives Exchange (NCDEX), June steel long futures were trading at ₹54,200 in the initial hour of Wednesday morning against the previous close of ₹53,500, up by 1.31 per cent.
May castor seed contracts were trading at ₹7,450 on NCDEX in the initial hour of Wednesday morning against the previous close of ₹7,496, down by 0.61 per cent.