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Commodities Energy

Oil and natural gas daily review (May 26, 2014)

May 26, 2014, Monday, 07:27 GMT | 03:27 EST | 11:57 IST | 14:27 SGT
Contributed by Angel Broking

Crude Oil

In the last week, Nymex crude oil prices traded on a positive note as Libya's major western oilfields, El Sharara and El Feel, remained shut a week after the government said it reached a deal with protesters to reopen them. National output has been capped at 210,000 barrels per day (bpd), far below the 1.4 million bpd produced until mid-2013.

On the other side, the conflict in Ukraine is supporting oil, as U.S. President Barack Obama and French President Francois Hollande said Russia faced significant costs if it continues "provocative and destabilizing behavior.

WTI oil prices touched a one month high after the EIA report released last Wednesday showed large draw in commercial crude stocks, while renewed fighting in Libya that kept output low boosted Brent prices.

In addition, data out of China showed the factory sector has performed the best in five months in May, and U.S. home re-sales rose in April, showing hopeful signs that the stalled housing market is turning toward recovery.

WTI Crude oil prices touched a weekly high of $104.5/bbl and closed at $104.35/bbl gaining by around 2.28 percent in the last week.

On the domestic bourses, prices gained by 2.27 percent due taking cues from international market. Crude prices closed at Rs.6120/bbl on Friday after touching a weekly high of Rs.6125/bbl.


On an intraday basis, we expect crude prices to trade sideways after its positive run for over a week now. Escalation of violence in Libya, good economic data coming out of China and the US will act as a positive factor and support prices.

On the other hand, the inventory withdrawal in the recent week indicates the summer demand to come in from all quarters of the US after Memorial Day in the US which will kick start the driving season.

On the MCX, crude prices are expected to trade sideways taking cues from international markets.