Commodities

Oil and natural gas daily review (January 29, 2013)

Contributed by Angel Broking

Crude Oil

Nymex crude oil prices increased around 0.8 percent yesterday on favorable US durable goods orders data which led to expectations of rise in demand for the fuel. Additionally, rise in the petroleum consumption along with unrest in the Middle East also supported an upside in the crude oil prices.

However, sharp upside in the crude oil prices was capped as a result of strength in the DX. Crude oil prices touched an intra-day high of $96.81/bbl and settled at $96.44/bbl in yesterday's trading session.

On the domestic bourses, prices gained by 0.4 percent and closed at Rs.5,213/bbl after touching an intra-day high of Rs.5,235/bbl on Monday.

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 2.6 million barrels for the week ending on 25th January 2012. Gasoline stocks are expected to rise by 0.1 million barrels and distillate inventories are expected to decline by 0.5 million barrels for the same week

Outlook

In today's session, we expect crude oil prices to trade higher as signs of global recovery are expected to raise the demand from the oil. Weakness in the DX is also expected to support an upside in the crude oil prices today. However, expectation of rise in the crude oil supplies is expected to cap gains in the crude oil prices. In the domestic market, appreciation in the rupee is expected to cap gains in the crude oil prices on MCX.