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Commodities Energy

Oil and natural gas daily review (July 22, 2014)

July 22, 2014, Tuesday, 11:03 GMT | 06:03 EST | 14:33 IST | 17:03 SGT
Contributed by Angel Broking


Crude Oil

Nymex crude prices jumped by more than 1 percent yesterday owing to geopolitical turmoil in Ukraine and the Middle East.

Also, intensified pressure after western leaders from the U.K., France and Germany have warned Russian President Vladimir Putin of increased sanctions by Tuesday if international investigators are not allowed full access to the crash site acted as a positive factor for prices.

Considering developments on the Iran front, Chinese customs data showed that Iranian oil imports in the first six months of 2014 were 630,000 barrels a day as the U.S. is trying to reach a new agreement with Iran over its nuclear program while still keeping pressure on Tehran. Last week, Iran agreed to new steps to contain its nuclear program in exchange for additional sanctions relief from the U.S. The two sides also extended negotiations for four more months.

On the domestic bourses, prices gained by 0.8 percent 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 decline by 2.8 million barrels for the week ending on 18th July 2014.

Gasoline stocks are expected to gain by 0.9 million barrels and distillate inventories are expected to rise by 2.4 million barrels for the same week.


Outlook

On an intraday basis, we expect crude oil prices to trade on a positive note ahead of stockpile data that may signal the strength of fuel demand in the U.S., the world’s biggest oil consumer.

Also, ongoing geopolitical tensions in the Ukraine and Middle East will continue to act as a positive factor for prices.

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

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