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Relaxation of Covid norms in China helped crude oil futures trade climb higher on Monday morning.
At 10.03 am on Monday, January Brent oil futures were at $96.29, up by 0.31 per cent,and December crude oil futures on WTI were at $89.19, up by 0.26 per cent.
November crude oil futures were trading at ₹7,222 on Multi Commodity Exchange (MCX) in the initial trading hour of Monday morning against the previous close of ₹7,124, up by 1.38 per cent, and December futures were trading at ₹7,184 against the previous close of ₹7,083, up by 1.43 per cent.
China’s decision to relax Covid-related restrictions helped boost the crude oil market. China is a major consumer of crude oil, and the Covid-related measures impacted demand.
Aid for logistics
The National Health Commission of China adjusted Covid prevention and control protocols last week. The measuresincluded ensuring smooth logistics for firms and industrial parks during outbreaks. Important firms cannot be arbitrarily asked to suspend production due to an outbreak.
It revised the quarantine norms for employees with high risk of Covid infection to five days at home instead of seven days at a centralised location or at home, as stipulated previously.
With more demand expected, the prospects of tighter supply in global markets following last month’s decision by the Organisation of Petroleum Exporting Countries and its allies, known as OPEC+, to reduce output by 2 million barrels a day, and the European Union’s ban on import of Russian oil from December supported the bullish outlook for the commodity.
Guar gum gains
November natural gas futures were trading at ₹489.40 on MCX in the initial trading hour of Monday against the previous close of ₹476, up by 2.82 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), November guar gum contracts were trading at ₹10,490 in the initial trading hour of Monday against the previous close of ₹10,219, up by 2.65 per cent.
December steel long futures were trading at ₹45,460 on NCDEX in the initial trading hour of Monday against the previous close of ₹45,910, down by 0.98 per cent.
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