Libyan production cut, likely demand revival from China boost crude oil prices

BL Mangaluru Bureau | | Updated on: Apr 19, 2022

Oil price graph, oil pump nozzle and stock market chart | Photo Credit: bluebay2014

April crude oil futures were trading at ₹8,268 on Multi Commodity Exchange (MCX) in the initial hour of Tuesday morning against the previous close of ₹8,337

The ongoing protest against the Libyan Prime Minister, Abdul Hamid Dbeibah, which has affected the crude oil production and loading from that country, continued to make an impact on the crude oil futures on Tuesday also. The likely demand revival from China also helped the commodity gain on exchanges.

At the time of filing this report, June Brent oil futures were trading up 1.77 per cent at $113.68 a barrel and June crude oil futures on WTI were at $107.71, up by 0.09 per cent.

April crude oil futures were trading at ₹8,268 on Multi Commodity Exchange (MCX) in the initial hour of Tuesday morning against the previous close of ₹8,337, down by 0.83 per cent; and May futures were trading at ₹8,238 against the previous close of ₹8,316, down by 0.94 per cent.

Libya, which is member of Organization of Petroleum Exporting Countries (OPEC), has been facing protests against the Prime Minister, Abdul Hamid Dbeibah, since Sunday. Following this, crude oil production was stopped at El Feel oil field, and some Libyan ports stopped loading crude oil cargoes. According to reports, Libya’s oil production has declined by more than half a million barrels a day following these incidents.

This development comes at a time when the world market is facing tight supply of crude oil due to Russia-Ukraine war. Russia is a major producer of crude oil in the world. While countries such as US and UK have imposed sanctions on Russia, banning the import of crude oil from that country, some European nations are also contemplating such a move.

Reports also indicated that crude oil demand from China is likely to resume as manufacturing plants in Shanghai are preparing to reopen after a three-week-long lockdown in the region. China is a major importer of crude oil.

April aluminium futures were trading at ₹275.35 on MCX in the initial hour of Tuesday morning against the previous close of ₹271.55, up by 1.40 per cent.

Turmeric up on NCDEX

On the National Commodities and Derivatives Exchange (NCDEX), May turmeric (farmer polished) futures were trading at ₹9,048 in the initial hour of Tuesday morning against the previous close of ₹8,896, up by 1.71 per cent.

May castor seed contracts were trading at ₹7,218 on NCDEX in the initial hour of Tuesday morning against the previous close of ₹7,258, down by 0.55 per cent.

Published on April 19, 2022
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