Apprehensions over the economic recovery in China following the release of inflation data impacted the crude oil futures on Friday morning.

At 10.05 am on Friday, August Brent oil futures were at $75.41, down by 0.72 per cent; and July crude oil futures on WTI were at $70.75, down by 0.76 per cent.

June crude oil futures were trading at ₹5,844 on Multi Commodity Exchange (MCX) in the initial trading hour of Friday morning against the previous close of ₹5,903, down by 1 per cent; and July futures were trading at ₹5,884 as against the previous close of ₹5934, down by 0.84 per cent.

China’s consumer price index (CPI) and producer price index (PPI) declined in May when compared to the previous month. China’s CPI declined by 0.2 per cent in May against a decline of 0.1 per cent in April. China’s PPI declined by 4.6 per cent in May against a decline of 3.6 per cent in April.

These numbers, along with other economic indicators that were released over the past two weeks, created apprehensions in the market over the economic recovery in China. Crude oil market was betting big on China’s economic recovery as it is one of the major consumers of crude oil in the global market.

Market fears that weak economic indicators from China may impact the demand for crude oil, which, in turn, may impact the price of the commodity.

On Thursday, crude oil prices declined sharply following a news report that the US and Iran have reached a temporary nuclear agreement, which will allow Iran to restart the export of around 1 million barrels a day of crude oil. However, the market recovered afterward following the denial of this news by both countries.

June menthaoil futures were trading at ₹906.90 on MCX in the initial trading hour of Friday morning against the previous close of ₹913.20, down by 0.69 per cent.

On the National Commodities and Derivatives Exchange (NCDEX), June guargum contracts were trading at ₹10,449 in the initial trading hour of Friday morning against the previous close of ₹10610, down by 1.52 per cent.

June dhaniya futures were trading at ₹5,932 on NCDEX in the initial trading hour of Friday morning against the previous close of ₹5,982, down by 0.84 per cent.

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