Commodities

Oil and natural gas daily review (September 28, 2012)

Contributed by Angel Broking

Crude Oil

Nymex crude oil prices increased by 2.1 percent yesterday taking cues from expectations of stimulus measures from Chinese policymakers to boost the economic growth along with Spain's Prime Minister Mariano Rajoy has assured to cut the country's deficit by at least 18 billion Euros.

Additionally, weakness in the DX also supported upside in the prices. Crude oil prices touched an intra-day high of $92.39/bbl and closed at $91.90/bbl in yesterday's trading session.

On the domestic bourses, prices gained by 1.3 percent and closed at Rs.4,886/bbl after touching an intra-day high of Rs.4,905/bbl on Thursday. However, appreciation in the Indian Rupee capped sharp gains in crude prices on the MCX.

Natural Gas

Nymex natural gas prices gained more than 9 percent yesterday on the back of ease in concerns that stockpiles will reach its limits before the winter weather which will boost the demand for the commodity.

However, further upside in the prices was capped on account of more than expected rise in US natural gas inventories. In the Indian markets, prices gained around 1.6 percent as appreciation in the Rupee restricted sharp gains.

EIA Inventories Data

US Energy Information Administration (EIA) released its weekly inventories yesterday and US natural gas inventory has increased more than expected by 80 billion cubic feet (bcf) which stood at 3.576 trillion cubic feet for the week ending on 21st September 2012.

Outlook

In today's session, we expect crude oil prices to trade with positive bias on the back of upbeat global market sentiments along with weakness in the DX. On the domestic front appreciation in the Indian Rupee will however, cap sharp gains in the MCX crude prices.