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Commodities Energy

Oil and natural gas daily review (June 23, 2014)

June 23, 2014, Monday, 06:04 GMT | 01:04 EST | 09:34 IST | 12:04 SGT
Contributed by Angel Broking


Crude Oil

Concerns over potential disruptions over oil exports from Iraq supported oil prices in the last week

Scores of Iraqis were killed last week during a battle for the provincial capital of Baquba as an uprising by Sunni insurgents continued to threaten the disintegration of Iraq.

The fighting also shut the country's main oil refinery, starving parts of the country of fuel. However, Iraq's oil refineries in the south, which process most of the country's 3.3 million barrels per day of oil production, have been unaffected so far.

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.


Natural gas

U.S. natural gas futures fell on Friday and ended the week 4 percent lower as utilities refill storage at a record pace and weather forecasts call for some cooler weather and weaker demand in the eastern part of the country next week.


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.