Despite OPEC (Organization of the Petroleum Exporting Countries) and its allies planning to increase crude oil output, the energy commodity ruled steady in the global futures market on Friday morning as traders turned cautious over the hike in production.

At 10.02 am on Friday, August Brent oil futures were at $117.43, up by 0.98 per cent, and July crude oil futures on WTI were at $116.59, down by 0.24 per cent.

June crude oil futures were trading at ₹9,032 on Multi Commodity Exchange (MCX) in the initial hour of Friday morning against the previous close of ₹9,045, down by 0.14 per cent; and July futures were trading at ₹8,865 as against the previous close of ₹8,882, down by 0.19 per cent.

Theministerial meeting of OPEC+ members on Thursday decided to adjust the July and August production upward by 648,000 barrels a day. The original plan was to increase it by 432,000 barrels a day.

Inadequate compensation

Market participants feel that this increase is not enough to compensate for the potential loss of more than one million barrels a day from Russia. Russia has been facing sanctions from the US, the UK and some other western nations for its war with Ukraine. The loss of Russian crude oil supply has affected the already tight global oil market.

Added to this, the petroleum status report for the week ended May 27, which was released by US EIA (Energy Information Administration) on June 2, noted that the US commercial crude oil inventories (excluding those in the strategic petroleum reserve) decreased by 5.1 million barrels from the previous week. At 414.7 million barrels, US crude oil inventories were about 15 per cent below the five-year average for this time of year.

According to EIA, US crude oil imports averaged 6.2 million barrels a day last week, down by 268,000 barrels a day from the previous week. Over the past four weeks, crude oil imports averaged about 6.4 million barrels a day, 7.3 per cent more than the same four-week period last year.

June zinc futures were trading at ₹338.70 on MCX in the initial hour of Friday morning against the previous close of ₹336.90, up by 0.53 per cent.

Dhaniya gains flavour

On the National Commodities and Derivatives Exchange (NCDEX), June dhaniya futures were trading at ₹11,264 in the initial hour of Friday morning against the previous close of ₹11,188, up by 0.68 per cent.

June castorseed contracts were trading at ₹7,496 on NCDEX in the initial hour of Friday morning against the previous close of ₹7,452, up by 0.59 per cent.

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