An increase in demand for fuel from the US and China and a slightly weak dollar helps crude oil futures to trade marginally higher on Monday morning.
At 10.03 am, July Brent oil futures were at $113.37, up 0.72 per cent, and July crude oil futures on WTI were at $110.91, up 0.57 per cent.
June crude oil futures were trading at ₹8,620 on Multi Commodity Exchange (MCX) in the early deals against the previous close of ₹8,618, up by 0.02 per cent; and July futures were trading at ₹8,406 against the previous close of ₹8,404, up by 0.02 per cent.
Market reports cited the US mobility data from different agencies to highlights that there has been an increase in people’s mobility. This data has come at a time when fuel prices are going up.
Another news supporting the demand revival came from China. According to reports, China is relaxing Covid restrictions. Shanghai, which faced one of the stringent Covid restrictions in the recent weeks, is planning to reopen from June 1. This is likely to l boost the fuel demand.
Dollar index nosedives
In his crude oil outlook for the day, Rahul Kalantri, VP (Commodities) of Mehta Equities Ltd, said crude oil prices settled higher on Friday on hopes of Chinese demand rebounding after Shanghai lifted some coronavirus lockdowns. The jump in crude oil prices were supported by record gains in the US gasoline prices, weakness in the dollar index, and easing Covid lockdown restrictions in China. The dollar index slipped from 20-year highs and supported global commodities.
Meanwhile, last week, the US dollar index witnessed a steep fall after failing to sustain around the fresh 19-year high at 105 that also supported crude oil prices, he said.
“We expect crude oil prices to remain volatile in today’s session. Crude oil price has support at $106.20-$104.40 and resistance at $111.40-$113.65, In rupee terms, crude oil has support at ₹8,510-8,420, and resistance at ₹8,750–8,870,” he said.
May zinc futures were trading at ₹320.55 on MCX in the initial hour of Monday morning against the previous close of ₹319.20, up by 0.42 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), June turmeric (farmer polished) futures were trading at ₹8,272 in the initial hour of Monday morning against the previous close of ₹8202, up by 0.85 per cent.
June steel long contracts were trading at ₹51,000 on NCDEX in the initial hour of Monday morning against the previous close of ₹53,190, down by 4.12 per cent.