After witnessing around 2 per cent drop in Tuesday’s session, crude oil futures traded higher on Wednesday morning. The scheduled meeting of the Joint Ministerial Monitoring Committee (JMMC) of OPEC+ (Organization of Petroleum Exporting Countries) and its allies next week is boosting the demand for the commodity.
At 10 am on Wednesday, March Brent oil futures were at $86.58, up by 0.52 per cent, while the March crude oil futures on WTI were at $80.47, up by 0.42 per cent.
February crude oil futures were trading at ₹6,571 on Multi Commodity Exchange (MCX) in the initial trading hour of Wednesday morning against the previous close of ₹6562, up by 0.14 per cent, while the March futures were trading at ₹6620 against the previous close of ₹6,613, up by 0.15 per cent.
Nod for current policy
Quoting sources in OPEC+, a Reuters report said the JMMC of OPEC+, which is scheduled to meet virtually on February 1, is likely to endorse the current oil output policy of the group. The sources felt that while the demand from China is leading a price rally, apprehensions over the inflation and slowdown in several economies are limiting further increase in the price of the commodity.
Citing sources, the report said the JMMC would discuss the economic outlook and the scale of Chinese demand, and it is unlikely to suggest tweaks to current policy.
However, the crude oil price rally was limited by the reports of bigger than expected crude oil inventories in the US for the week ending January 20.
Market reports citing the American Petroleum Institute (API) said the crude oil inventories in the US went up to 3.4 million barrel for the week ending January 20. This was much above the market expectations. Increase in inventories indicate the enough supply of the commodity in the market to meet the demand in near-term.
However, the official data on crude oil inventories are expected from the US EIA (Energy Information Administration) later in the day.
Guar gum, jeera head south
February natural gas futures were trading at ₹252.20 on MCX in the initial trading hour of Wednesday morning against the previous close of ₹256.30, down by 1.60 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), February guar gum contracts were trading at ₹12,491 in the initial trading hour of Wednesday morning against the previous close of ₹13,011, down by 4 per cent.
March jeera futures were trading at ₹31,855 on NCDEX in the initial trading hour of Wednesday morning against the previous close of ₹32,385, down by 1.64 per cent.