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Crude oil futures traded lower on Thursday morning as the minutes of April’s meeting of the US Federal Reserve showed committee members’ willingness to tighten the policy further if inflation increases in the US.
At 10.14 am on Thursday, July Brent oil futures were at $81.45, down by 0.55 per cent, and July crude oil futures on WTI (West Texas Intermediate) were at $77.05, down by 0.67 per cent.
June crude oil futures were trading at ₹6,431 on the Multi Commodity Exchange (MCX) during initial trading on Thursday morning, against the previous close of ₹6,492, down by 0.94 per cent, and July futures were trading at ₹6,430 against the previous close of ₹6,487, down by 0.88 per cent.
Rate impact
Minutes of April’s meeting of the US Federal Reserve, which were released on Wednesday, showed that the recent economic data did not increase the confidence of the policymakers to return to the 2 per cent inflation target over the medium term.
“Various participants mentioned a willingness to tighten policy further should risks to inflation materialise in a way that such an action became appropriate,” minutes of the meeting said.
Increase in interest rates makes commodities such as crude oil costlier in the market, impacting the demand for such commodities.
US inventories rise
The petroleum status report for the week ending May 17 by the US EIA (Energy Information Administration) said US commercial crude oil inventories increased by 1.8 million barrels from the previous week. At 458.8 million barrels, US crude oil inventories were about 3 per cent below the five-year average for this time of year. The market was expecting it to decline by 2.55 million barrels for the week ending May 17.
Total motor gasoline inventories decreased by 0.9 million barrels from last week, and were about 2 per cent below the five-year average for this time of year.
Total products supplied over the last four-week period averaged 20.2 million barrels a day, up by 0.7 per cent from the same period last year. Over the past four weeks, the motor gasoline product supplied averaged 8.9 million barrels a day, down by 1.8 per cent from the same period last year.
Turmeric gleams, jeera dips
May copper futures were trading at ₹889.85 on the MCX, against the previous close of ₹896.15, down by 0.70 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), June turmeric (farmer polished) contracts were trading at ₹19,750, against the previous close of ₹19,648, up by 0.52 per cent.
June jeera futures were trading at ₹29,100 on NCDEX, against the previous close of ₹29,240, down by 0.48 per cent.
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