Oil prices fall for second straight day on coronavirus concerns, profit booking; Brent slips below $74 a barrel

Us Crude May19

Unrefined oil futures on June 29 traded lower as participants reserved revenue ahead of the OPEC+ meeting and renewed coronavirus issues as rising delta variant cases throughout the world may dampen fuel demand recovery. The energy commodity has actually declined over 2 percent after striking a fresh 52-week high in the other day’s session.

On the MCX, crude oil delivery for July dropped Rs 30, or 0.55 percent, to Rs 5,384 per barrel at 16:13 hours IST with an organization turnover of 6,367 lots. The delivery for August declined Rs 24, or 0.45 percent to Rs 5,361 per barrel with a business volume of 515 lots.

The value of July and August’s agreements traded up until now is Rs 947.50 crore and Rs 14.39 crore, respectively.

West Texas Intermediate (WTI) unrefined slipped 0.64 percent to $72.44 per barrel, while Brent crude, the London-based international standard, fell 0.40 percent to $73.84 per barrel.

“NYMEX unrefined trades partially lower near $72.5/ bbl. Crude has actually pulled back from Oct 2018 highs in the middle of revenue taking ahead of OPEC+ conference this week where the group will go over production hike. Renewed infection concerns, slower activity in China and Fed’s financial tightening concerns likewise weighing on price. However, supporting the cost is lower United States unrefined stocks, US optimism and uncertainty about Iran’s nuclear deal. Crude might stay sideways ahead of OPEC choice; however, the basic bias is still on the advantage as OPEC is unlikely to shock with a major production walking,” said Ravindra Rao, CMT, EPAT, VP- Head Product Research at Kotak Securities.

Prathamesh Mallya, AVP- Research Study, Non-Agri Commodities and Currencies, Angel Broking Ltd stated, “Markets will stay careful ahead of the Organisation of Petroleum Exporting Countries and allies satisfy set up on July 1, 2021, i.e. Thursday. The group is returning 2.1 million barrels each day in the worldwide markets from May 2021 to July 2021. Markets anticipate that the group may continue to reduce production curbs enforced in 2020 following bets on increase in fuel demand in the months ahead.”

He included that the variety of COVID cases in Asia, Australia and Europe paused the rally in oil rates on the very first trading day of the week.

Technicals

The black gold has actually been trading greater than 20, 50, 100 and 200 days’ moving averages but lower than the 5-day moving averages on a daily chart. The momentum indication Relative Strength Index (RSI) is at 64.43, indicating bullish motion in rates.

Trading Technique

Tapan Patel- Senior Expert (Commodities), HDFC Securities

Unrefined oil costs traded under pressure on need growth concerns as increasing delta variant cases across the world may dampen fuel need recovery. The UK reported the highest daily rise in COVID-19 cases on Monday given that January 30. Hong Kong, Spain and Portugal banned all guest flights from the country to suppress the spread of break outs involving COVID-19’s Delta version. The speculation ahead of OPEC plus conference this week and US summer season driving season demand might keep oil rates on edge for the short-term.

Petroleum costs are anticipated to trade sideways to up for the day with resistance at $74 and support at $72 per barrel. MCX Petroleum July has support at Rs 5,350 and resistance at Rs 5,490.

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Disclaimer: The views and financial investment ideas expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to talk to qualified professionals prior to taking any financial investment decisions.Published at Tue, 29 Jun 2021
11:16:46 +0000