Commodities

Oil and natural gas daily review (February 28, 2013)

Contributed by Angel Broking

Crude Oil

Nymex crude oil prices gained by 0.1 percent yesterday taking cues from less than expected rise in US crude oil inventories coupled with favorable economic data from the US.

In addition, crude oil prices also took support from the failure on Iran's nuclear talks with the US.

Additionally, weakness in the DX also supported an upside in the prices. Crude oil prices touched an intra-day high of $93.37/bbl and closed at $92.80/bbl in yesterday's trading session.

On the domestic bourses, prices declined by 0.4 percent on account of appreciation in the Indian Rupee and closed at Rs.5,007/bbl after touching an intra-day low of Rs.4,986/bbl on Wednesday.

EIA Inventories Data

As per the US Energy Department (EIA) report, US crude oil inventories rose less than expectations by 1.13 million barrels to 377.53 million barrels for the week ending on 22nd February 2013. Gasoline stocks declined by 1.86 million barrels to 228.54 million barrels and whereas distillate stockpiles gained by 0.56 million barrels to 124.10 million barrels for the last week.

Natural Gas

EIA Inventories Forecast

US Energy Information Administration (EIA) is scheduled to release its weekly inventories and US natural gas inventory are expected to decline by 165 billion cubic feet (bcf) for the week ending on 22nd February 2013.

Outlook

In today's session, we expect crude oil prices to trade with positive bias due to favorable economic data from US coupled with weakness in the DX. Additionally, optimistic statement from US Fed Chairman Ben Bernanke and ECB President Mario Draghi will also support an upside in the prices. In the Indian markets, appreciation in the Rupee will prevent upside in the prices on the MCX.