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Commodities Energy

Oil and natural gas daily review (March 21, 2014)

March 21, 2014, Friday, 05:49 GMT | 01:49 EST | 10:19 IST | 12:49 SGT
Contributed by Angel Broking


Crude Oil

Rising equities in the US, fresh sanctions against Russia injected fresh premium in crude markets that supported crude prices. However WTI crude oil contract declined on account of expiration of the contract.

Geo-political tensions are back in picture as the United States expanded sanctions to 20 more prominent Russians, including allies of Russian President Vladimir Putin, in the latest sign of mounting tensions over Moscow's annexation of Crimea.

On the supply side, gasoline inventories at Europe's Amsterdam-Rotterdam-Antwerp (ARA) storage hub are near-six-year highs last week, indicating ample supply. In addition, exacerbating U.S. data that showed domestic crude inventories rose sharply for the second week in a row might exert downside pressure on crude prices.

On the MCX crude prices declined by 0.4 percent to close at Rs.6085/bbl on Thursday.


Natural Gas

EIA Inventories update

The US Energy Department (EIA) released its weekly natural gas inventories report yesterday at 8:00pm IST and inventories declined by 48BCF for the week ending 14th March 2014.


Outlook

From intraday perspective, crude prices will trade higher on the back of geo-political tensions back in forefront. In addition positive economic indicators from US also help crude prices to gain. The number of Americans filing for jobless benefits hovered near three-month lows last week and factory activity in the Mid-Atlantic region rebounded this month.

However ample inventories in the US as well as gasoline inventories at Amsterdam at near six year high makes supply side ample and can probably pull down prices in the evening session.

In the Indian markets, prices will trade mixed on account of the rupee strength and further developments in the Crimean region.