Commodities » Energy

Oil and natural gas daily review (March 21, 2013)

Contributed by Angel Broking

Crude Oil

Nymex crude oil prices increased around 0.9 percent yesterday taking cues from US Federal Reserve statement that it will continue with its bond buying program. Additionally, unexpected decline in US crude oil inventories supported an upside in the oil prices.

Weakness in the DX also acted as a positive factor for the prices. Oil prices touched an intra-day high of $93.28/bbl and closed at $93.20/bbl in yesterday's trading session.

On the domestic bourses, prices rose by 1.6 percent on account of depreciation in the Indian Rupee and closed at Rs.5092/bbl after touching an intra-day high of Rs.5114/bbl on Wednesday.

EIA Inventories Data

As per the US Energy Department (EIA) report, US crude oil inventories declined unexpectedly by 1.31 million barrels to 382.70 million barrels for the week ending on 15th March 2013.

Gasoline stocks fell by 1.5 million barrels to 222.80 million barrels and whereas distillate stockpiles dropped by 0.7 million barrels to 119.80 million barrels for the last week.


Natural Gas

EIA Inventories Forecast

US Energy Information Administration (EIA) is scheduled to release its weekly inventories and US natural gas inventory are expected to decline by 70 billion cubic feet (bcf) for the week ending on 15th March 2013.


Outlook

From the intra-day perspective, we expect crude oil to trade on positive note on the back of upbeat global market sentiments coupled with weakness in the DX. Additionally, US Federal Reserve statement of continuing its bond buying program coupled with ECB giving assurance to Cyprus to provide liquidity will also support an upside in the prices.

In the Indian markets, appreciation in the Rupee will cap sharp gains in the prices on the MCX.