Crude oil futures traded higher on Monday morning following the market expectations of oil production cuts by Saudi Arabia and Russia in the coming days. Added to this, China’s central bank kept its loan prime rate (LPR) unchanged and infused more yuan into the economy.

At 9.56 am on Monday, January Brent oil futures were at $81.23, up 0.77 per cent, and January crude oil futures on WTI (West Texas Intermediate) were at $76.67, up 0.83 per cent.

December crude oil futures were trading at ₹6,401 on Multi Commodity Exchange (MCX) during initial trading against the previous close of ₹6,346, up 0.87 per cent, and January futures were trading at ₹6,425 as against the previous close of ₹6,384, up 0.64 per cent.

Nov 26 OPEC meet agenda?

The market is expecting production cuts by some of the members of OPEC (Organisation of the Petroleum Exporting Countries) and its allies, known as OPEC+, when they meet on November 26. A Reuters report, which quoted OPEC+ sources, said the group is set to consider whether to make additional production cuts when it meets on November 26.

The market is expecting that Saudi Arabia and Russia, two of the main members of OPEC+, could extend their production output cuts in 2024 also. They have already announced additional production cuts till the end of 2023.

Crude oil prices had witnessed a downtrend in the past four weeks following the decline in the demand for the commodity. Data from the US and OPEC+ also indicated that crude oil supplies were not as tight as expected.

Meanwhile, People’s Bank of China has kept unchanged its one-year LPR at 3.45 per cent and five-year LPR at 4.20 per cent. These rates are at the historic lows now.

Added to this, People’s Bank of China also infused around 92 billion yuan into the economy on Monday. Last week, Chinese central bank had infused around 600 billion yuan into the economy.

China is making all efforts to boost its economy following the release of weak economic data points in the past few days. It is one of the major consumers of crude oil in the world market, and any developments in its economy impact the demand for commodities such as crude oil.

Dhaniya, jeera gain

November aluminium futures were trading at ₹205.20 on MCX against the previous close of ₹203.40, up 0.88 per cent.

On the National Commodities and Derivatives Exchange (NCDEX), December jeera contracts were trading at ₹44,750 against the previous close of ₹43,030, up 4 per cent.

December dhaniya futures were trading at ₹8,136 on NCDEX against the previous close of ₹8,040, up 1.19 per cent.

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