Crude oil, which saw a steep decline this week, traded higher on Thursday morning. This followed the US Federal Reserve’s indication of pausing further rate hikes. As expected by the market, the Fed announced an increase of 25 basis points in interest rates on Wednesday in its efforts to control inflation in the US.

At 9.55 am on Thursday, July Brent oil futures were at $72.73, up by 0.55 per cent, and June crude oil futures on WTI were at $68.84, up by 0.35 per cent.

May crude oil futures were trading at ₹5651 on Multi Commodity Exchange (MCX) against the previous close of ₹5647, up by 0.07 per cent; and June futures were trading at ₹5685 as against the previous close of ₹5676, up by 0.16 per cent.

Also read: Sensex, Nifty climb in early trade amid buying in major stocks

Russia-Ukraine tension

Quoting the Fed Chair Jerome Powell, a Reuters report said it was now an open question whether further rate increases will be warranted in an economy still facing high inflation, but also showing signs of a slowdown and with risks of a tough credit crackdown by banks on the horizon.

Meanwhile, potential disruption in the supply of crude due to the escalation of tension between Russia and Ukraine also supported the price of the commodity.

The reported drone attack on Russia, which, Russia alleged that an attempt by Kyiv on the life of Russian President Vladimir Putin gave an indication of a potential escalation in the war. Reacting to the drone attack, Russia said it had a right to retaliate.

Russia is a major supplier of crude oil to the Asian market, and any escalation in the war between Russia and Ukraine may impact the crude oil supplies.

Also read: The limits to sourcing Russian oil

Stocks drop

Added to this, the weekly crude oil inventory report by the US EIA (Energy Information Administration) also supported the price of crude oil.

US commercial crude oil inventories (excluding those in the strategic petroleum reserve) decreased by 1.3 million barrels for the week ending April 28 from the previous week. At 459.6 million barrels, US crude oil inventories were about 2 per cent below the five-year average for this time of the year.

However, there was an increase in the gasoline inventories in the US indicating a decline in the demand for gasoline in the US market. Total motor gasoline inventories increased by 1.7 million barrels from last week and were about 6 per cent below the five-year average for this time of year.

Turmeric, jeera gleam

May copper futures were trading at ₹743 on MCX in the initial trading hour of Thursday morning, up by 1.04 per cent.

On the National Commodities and Derivatives Exchange (NCDEX), May turmeric (farmer polished) contracts were trading at ₹7320 in the initial trading hour of Thursday morning, up by 1.47 per cent.

May jeera futures were trading at ₹45755 on NCDEX in the initial trading hour of Thursday morning, up by 0.58 per cent.

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