Commodities

Oil and natural gas daily review (March 01, 2013)

Contributed by Angel Broking

Crude Oil

Nymex crude oil prices declined around 0.8 percent yesterday taking cues from less than expected rise in the US GDP data. Additionally, negative statement from International Monetary Fund (IMF) spokesman William Murray that it will lower the growth forecast for US as a result of appropriation.

Further, strength in the DX also added downside pressure on the oil prices. Crude oil prices touched an intra-day low of $91.57/bbl and closed at $92.05/bbl in yesterday's trading session.

On the domestic bourses, prices gained by 1.4 percent as a result of depreciation in the Indian Rupee and closed at Rs.5,076/bbl after touching an intra-day high of Rs.5,092/bbl on Thursday.

Natural Gas

Nymex natural gas prices rose by more than 2 percent on the back of more than expected decline in the US natural gas inventories.

However, sharp upside in the prices was capped on account of forecast for less cool winter weather coupled with strength in the DX. Gas prices touched an intra-day high of $3.508/mmbtu and closed at $3.493/mmbtu on Thursday.

On the domestic front, prices gained by 0.5 percent and closed at Rs.191.10/mmbtu after touching an intra-day high of Rs.191.60/mmbtu in yesterday's trade.

EIA Inventories Data

US Energy Information Administration (EIA) released its weekly inventories yesterday and US natural gas inventory declined more than expected by 171 billion cubic feet (bcf) which stood at 2.229 trillion cubic feet for the week ending on 22nd February 2012.

Outlook

In today's session, we expect crude oil prices to trade with negative bias due to US GDP growing at slower pace, weak global market sentiments along with strength in the DX. Further, Euro zone unemployment rate is forecasted to rise coupled with fall in German retail sales data which will also exert downside pressure on the prices. In the Indian markets, depreciation in the Rupee will cushion sharp fall in the prices on the MCX.