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Commodities Energy

Oil and natural gas daily review (June 03, 2014)

June 3, 2014, Tuesday, 10:52 GMT | 05:52 EST | 14:22 IST | 16:52 SGT
Contributed by Angel Broking


Crude Oil

Strength in the dollar index and rising OPEC production lead to fall in both Brent and WTI oil prices in yesterday’s trading session. The market earlier shrugged off a report from industry intelligence company Genscape that TransCanada Corp's Keystone Gulf Coast crude oil pipeline was shut and later news that TransCanada said it was conducting maintenance on the pipeline until Wednesday.

On the MCX, crude prices declined by around 0.7 percent and closed at Rs.60604/bbl.

API inventory forecast

The API is scheduled to release its weekly inventories report tonight at 8:30pm IST and US crude oil inventories is expected to gain by 0.2 million barrels for the week ending on 30th May 2014. Gasoline stocks are expected to increase by 0.8 million barrels whereas distillate inventories are expected to increase by 0.8 million barrels for the same time period.


Natural gas

U.S. natural gas futures ended up 1.5 percent on Monday on forecasts for hot weather in the short term but cooler weather in the long term, and expectations for a bigger-than-normal storage build up.

On the MCX, natural gas prices gained by 0.77 percent taking strong cues from the international market and closed at Rs.273.30/MMBtu.


Outlook

On an intraday basis, we expect crude prices to trade on a positive note as report from Genscape that Keystone pipeline will remain shut till Wednesday will support upside in prices. In addition, crude production and exports from Libya still remains a question acting as a positive factor.

Meanwhile, crude prices will take cues from the API inventory report due to be released tonight and host of data sets to be released this week from the US as well as from Euro-zone.

On the MCX, crude prices are expected to trade with a positive bias taking cues from international markets.