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Commodities Energy

Oil and natural gas daily review (June 04, 2014)

June 4, 2014, Wednesday, 06:07 GMT | 01:07 EST | 09:37 IST | 12:07 SGT
Contributed by Angel Broking


Crude Oil

WTI oil prices rose in yesterday session on account of strong PMI data from the US. In addition, the European Central Bank will meet on Thursday to discuss a batch of measures aimed at stimulating the economy after inflation in the region dropped to record lows in May.

Investors were waiting for government data on U.S. oil inventories due later on Wednesday, after industry statistics showed a bigger-than-expected fall in crude stockpiles.

On the MCX, crude prices rose by half a percent and closed at Rs.6093/bbl.

API inventory update

The API released its weekly inventories report last night at 8:30pm IST and US crude oil inventories fell by 1.4 million barrels to 382.5 million for the week ending on 30th May 2014. Gasoline stocks rose by 0.8 million barrels whereas distillate inventories fell by 0.3 million barrels for the same time period.

EIA inventory forecast

The EIA is scheduled to release its weekly inventories report tonight at 8:30pm IST and US crude oil inventories is expected to declined by 0.3 million barrels for the week ending on 30th May 2014. Gasoline stocks are expected to decline by 0.2 million barrels whereas distillate inventories are expected to increase by 0.4 million barrels for the same time period.


Outlook

On an intraday basis, we expect crude prices to trade positive on account of strong manufacturing data from the US. Whereas the inventory data due to be released by the EIA tonight will provide further trajectory. On the geo-political front, Russia has given more time to Ukraine to pay off the gas bills easing a bit of tension.

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