Crude oil futures traded lower on Monday morning following the apprehensions over the economic slowdown in several economies and its impact on the demand for fuel. At 10.03 am on Monday, September Brent oil futures were at $102.53, down by 0.64 per cent; and September crude oil futures on WTI were at $93.92, down by 0.82 per cent.
August crude oil futures were trading at ₹7,527 on Multi Commodity Exchange (MCX) in the initial hour of Monday morning against the previous close of ₹7,660, down by 1.74 per cent; and September futures were trading at ₹7,380 as against the previous close of ₹7,509, down by 1.72 per cent.
Libya resumes production
One of the fears of economic slowdown was the expected interest rate hike by the US Federal Reserve. According to market reports, the US Federal Reserve could increase the interest rates by 75 basis points at its meeting, which is scheduled on July 26 and 27.
Market analysts felt that a major hike in interest rates would limit the demand for fuel affecting economic growth.
In addition to this, another news that impacted the market sentiments was the resumption of crude oil production in Libya. A statement by Libya's National Oil Corporation (NOC) on Saturday said that it aims to bring back production to 1.2 million barrels a day (bpd) in two weeks. This will help ease the supply constraints in the global markets to some extent.
However, the crude oil futures movement indicated a tight oil supply situation in the global market in the near term.
While September crude oil futures were trading at a premium in the range of $102.53, October and November futures were trading in the range of $97.60 and $95.21, respectively. Near-term crude oil futures were trading at a premium over the later-dated ones.
Natural gas, cottonseed gain
August natural gas futures were trading at ₹660.30 on MCX in the initial hour of Monday morning against the previous close of ₹651.60, up by 1.34 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), August cottonseed oilcake futures were trading at ₹2,677 in the initial hour of Monday morning against the previous close of ₹2,666, up by 0.41 per cent.
August castor seed contracts were trading at ₹7,248 on NCDEX in the initial hour of Monday morning against the previous close of ₹7,310, down by 0.85 per cent.