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Crude oil futures traded lower on Wednesday morning as the market players fear a weak demand outlook for the commodity due to aggressive monetary tightening measures by some major economies. Added to this, the Covid-19 related curbs in China also impacted the price of the commodity.
At 10 am on Wednesday, November Brent oil futures were at $91.55, down by 1.38 per cent; and October crude oil futures on WTI were at $85.20, down by 1.93 per cent.
September crude oil futures were trading at ₹6848 on Multi Commodity Exchange (MCX) in the initial trading hour of Wednesday morning against the previous close of ₹6933, down by 1.23 per cent; and October futures were trading at ₹6848 as against the previous close of ₹6936, down by 1.27 per cent.
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NSE Nifty 50 was down 0.47% at 17,572, while BSE Sensex slipped 0.53% to 58,881Market players are expecting an interest rate hike by European Central Bank this week. The rate hike is expected at a time when the region is facing an energy crisis. There were also indications that US Federal Reserve would go ahead with aggressive monetary tightening measures to control inflation in that country.
A stronger dollar is also impacting the crude oil prices, as the commodity is priced in dollars. A stronger dollar makes the commodity costlier for those who hold other currencies.
China, which is a major consumer of crude oil, is continuing with its strategy of lockdowns in some major cities to control Covid in the region. Being a major consumer, any lockdown would bring down the demand for crude oil impacting the economy of the country.
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Rupee falls 11 paise to 79.93 against US dollar in early trade
On Tuesday, the rupee depreciated 4 paise to close at 79.82 against the dollarSeptember crude oil futures were trading at ₹640.30 on MCX in the initial trading hour of Wednesday morning against the previous close of ₹655.90, down by 2.38 per cent.
NCDEX
On the National Commodities and Derivatives Exchange (NCDEX), September guargum futures were trading at ₹9,371 in the initial trading hour of Wednesday morning against the previous close of ₹9284, up by 0.94 per cent.
September cottonseed oilcake futures were trading at ₹2392 on NCDEX in the initial trading hour of Wednesday morning against the previous close of ₹2,432, down by 1.64 per cent.
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