Crude oil futures traded lower on Friday morning after the US President, Donald Trump, urged Saudi Arabia to reduce the oil prices.

At 9.59 am on Friday, March Brent oil futures were at $78.20, down by 0.11 per cent, and March crude oil futures on WTI (West Texas Intermediate) were at $74.50, down by 0.16 per cent.

February crude oil futures were trading at ₹6444 on Multi Commodity Exchange (MCX) during the initial hour of trading on Friday against the previous close of ₹6484, down by 0.62 per cent, and March futures were trading at ₹6414 against the previous close of ₹6450, down by 0.56 per cent.

Addressing the World Economic Forum at Davos virtually on Thursday, Trump urged Saudi Arabia to reduce oil prices to end war between Russia and Ukraine. “If the price came down, the Russia-Ukraine war would end immediately. Right now, the price is high enough that that war will continue - you got to bring down the oil price,” he said, adding, “They should have done it long ago. They’re very responsible, actually, to a certain extent, for what’s taking place.”

He also asked Saudi to increase investment package to $1 trillion. On Thursday, the state news agency of Saudi Arabia had stated that Saudi wants to invest around $600 billion into expanded investment and trade with the US over the next four years.

Replying to this, Trump said: “But I’ll be asking the Crown Prince, who’s a fantastic guy, to round it out to around $1 trillion. I think they’ll do that because we’ve been very good to them.”

On Friday, Warren Patterson, Head of Commodities Strategy of ING Think, said in the Commodities Feed that oil prices came under pressure on Thursday after President Trump’s virtual address at the World Economic Forum at Davos, where he called for lower oil prices.

However, with Russia becoming increasingly more aligned with OPEC members through the OPEC+ alliance, as well as higher fiscal breakeven oil prices for key members, it will be no easy task to convince OPEC to increase output, he said.

Meanwhile, petroleum status report by the US EIA (Energy Information Administration) for the week ending January 17 showed a decline in crude oil inventories in the US.

According to EIA, US commercial crude oil inventories decreased by 1 million barrels from the previous week. At 411.7 million barrels, US crude oil inventories were about 6 per cent below the five-year average for this time of year.

Total motor gasoline inventories increased by 2.3 million barrels from last week and were 1 per cent below the five-year average for this time of year.

Total products supplied in the US over the last four-week period averaged 19.7 million barrels a day, up by 0.7 per cent from the same period last year.

US crude oil imports averaged 6.7 million barrels a day last week, an increase of 621,000 barrels a day from the previous week.

February natural gas futures were trading at ₹300.40 on MCX during the initial hour of trading on Friday against the previous close of ₹297.70, up by 0.91 per cent.

On the National Commodities and Derivatives Exchange (NCDEX), April dhaniya contracts were trading at ₹8428 in the initial hour of trading on Friday against the previous close of ₹8402, up by 0.31 per cent.

March jeera futures were trading at ₹22375 on NCDEX in the initial hour of trading on Friday against the previous close of ₹22445, down by 0.31 per cent.

Published on January 24, 2025