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Commodities Energy

Oil and natural gas daily review (July 17, 2014)

July 17, 2014, Thursday, 07:10 GMT | 02:10 EST | 10:40 IST | 13:10 SGT
Contributed by Angel Broking


Crude Oil

WTI crude oil prices rose by more than 1.5 percent on Wednesday after government data showed the country's crude stockpiles fell sharply last week.

Oil prices receive some support from strong Chinese economic data earlier in the session. The country's economy expanded at a 7.5 percent annual pace in the second quarter as a result of government stimulus measures, signaling expectations of increasing demand. China's growth figures, however, were offset by news of rising supplies from Libya, where oil production has recovered to nearly 600,000 bpd.

Libya's National Oil Corp has offered the first crude oil from its major eastern Ras Lanuf terminal for end-July loading, two weeks after a rebel group agreed to end its nearly one-year blockade of the country's oil facilities.

EIA inventory update

The EIA released its weekly inventories report last night and US crude oil inventories declined by 7.5 million barrels for the week ending on 11th July 2014. Gasoline stocks rose by 0.171 million barrels whereas distillate inventories rose by 2.5 million barrels for the same time period.


Outlook

On an intraday basis, we expect crude oil prices to trade higher on optimism in the US economy, brightening demand prospects for crude coupled with strong growth in China as the GDP expanded at the rate of 7.5 percent.

On the contrary, Libya’s crude exports are gaining traction ensuring that oil markets are amply supplied with no major supply threats.

On the MCX, crude prices are expected to trade on a positive note taking cues from strong international markets.

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