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Commodities Energy

Oil and natural gas daily review (June 20, 2014)

June 20, 2014, Friday, 15:39 GMT | 10:39 EST | 19:09 IST | 21:39 SGT
Contributed by Angel Broking


Crude Oil

WTI crude rose on Thursday while Brent rose to nine month high as the United States said it would send military advisers to Iraq, raising concerns about the escalating conflict. Government forces continued to battle Sunni militants for control of Iraq's biggest refinery as U.S. President Barack Obama said the United States will send up to 300 military advisers to Iraq to combat the extremist insurgency.

The Baiji refinery near Tikrit, 200 km (130 miles) north of the Iraqi capital, remained under siege as troops loyal to the Shi'ite-led government held off insurgents from the Islamic State of Iraq and the Levant and its allies who stormed the perimeter, threatening national energy supplies.

On the MCX, crude prices rose marginally to close at Rs.6381/bbl

Natural gas inventory update

U.S. natural gas futures fell 1.6 percent on Thursday, hitting the lowest level in a week after the government reported yet another bigger-than-expected storage build. Utilities added 113 billion cubic feet of gas into storage, a record sixth consecutive weekly injection above 100 bcf.


Outlook

On an intraday basis, we expect crude prices to trade on a positive note as violence in Iraq has escalated further with militants taking control over the biggest refinery raising concerns on the supply side. It is Iraq story that is dominating the crude markets and this will continue unless there is a full proof solution to the fight between Shiaas and Sunnis.

On the MCX, crude prices are expected to trade on a positive note in line with strength in international markets.

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