Commodities

Oil and natural gas daily review (February 20, 2013)

Contributed by Angel Broking

Crude Oil

Nymex crude oil prices increased around 0.8 percent taking cues from statement by operators of the Seaway pipeline that crude oil flow will rise in near future. Additionally, European and German economic sentiments data came on a positive note which rose the expectations of rise in demand for the fuel.

Further, weakness in the DX also supported an upside in the crude prices. Crude oil prices touched an intra-day high of $96.73/bbl and closed at $96.66/bbl in yesterday's trading session.

On the domestic bourses, prices gained by 0.5 percent and closed at Rs.5,210/bbl after touching an intra-day high of Rs.5,219/bbl on Tuesday.

API Inventories Forecast

The American Petroleum Institute (API) is scheduled to release its weekly inventories today and US crude oil inventories are expected to rise by 2.4 million barrels for the week ending on 15th February 2013. Gasoline stocks are expected to decline by 1.2 million barrels and distillate inventories are expected to fall by 1.6 million barrels for the same week.

News:

Seaway pipeline volumes will be at an average of 295,000 barrels a day between February and May which is up from 180,000 barrels a day in the month of January.

Outlook

In today's session, we expect crude oil prices to trade with upward bias owing to signs of global recovery which might increase in the demand for the oil. Weakness in the DX is also expected to add to gains in the prices. Appreciation in the Indian Rupee will cap gains in the crude oil prices on the MCX.