Crude oil futures traded marginally lower on Tuesday morning despite a tight supply outlook in the coming months.
At 9.52 am on Tuesday, June Brent oil futures were at $86.07, down by 0.01 per cent, and May crude oil futures on West Texas Intermediate (WTI) were at $81.92, down by 0.04 per cent.
April crude oil futures were trading at ₹6,828 on Multi Commodity Exchange (MCX) during the initial hour of trading on Tuesday morning against the previous close of ₹6,824, up by 0.06 per cent, and May futures were trading at ₹6,789 against the previous close of ₹6,788, up by 0.01 per cent.
Media reports said the Russian government has asked refineries to reduce oil output in the second quarter of 2024 in line with the lower target set by the Organization of Petroleum Exporting Countries and allies, known as OPEC+.
Quoting three unnamed sources, a Reuters report said the Russian government has given specific targets to each company, indicating its intention to meet its OPEC+ pledge to cut output to support international oil prices.
Russia’s production target is 9 million barrels a day for the second quarter of 2024. It had produced 9.5 million barrels a day in February.
In addition to this, the continued drone attacks by Ukraine on Russian refineries are impacting oil production. Market reports said Kuibyshev refinery in Russia had to shut half its capacity after a fire broke out last week.
Meanwhile, a resolution by the UN Security Council called for an immediate ceasefire between Israel and Hamas in the Gaza strip. While Israel criticised this move, the US abstained from voting. However, the market is not confident that such a ceasefire would help stop attacks by the Houthis in the Red Sea. The recent attacks in the Red Sea route had impacted the transportation of various commodities on this route.
Turmeric gains
April copper futures were trading at ₹758.20 on MCX during the initial hour of trading on Tuesday morning against the previous close of ₹760.50, down by 0.30 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), April turmeric (farmer polished) contracts were trading at ₹17,900 during the initial hour of trading on Tuesday morning against the previous close of ₹17,488, up by 2.36 per cent.
April cottonseed oilcake futures were trading at ₹2,626 on NCDEX during the initial hour of trading on Tuesday morning against the previous close of ₹2,636, down by 0.38 per cent.