Now MCX Crude oil is getting support at 2817 and below same could see a test of 2765 level, And resistance is now likely to be seen at 3050, a move above could see prices testing 3160.
Crude oil on MCX settled down -4.43% at 2931 on supply glut concerns as official data showed U.S. crude stocks fell less than expected. Despite, data from the Information Energy Administration (IEA), showing that 99% of the targeted cut has been implemented during the first quarter of 2017, oversupply jitters returned as producers, who are not part of the deal to curb supply, the U.S. in particular, ramped up output, which has dampened OPEC’s effort to reduce global supply.
Saudi oil chief Khalid al-Falih acknowledged last week, that the first quarter of cuts failed to stem the glut in supply to below the five-year average but hinted at the possibility of extending the supply-cut agreement beyond June. OPEC is expected to decide at talks on May 25 whether to extend production the current deal to cut production for an additional six-months to the end of the year.
The slide came a day after the Energy Information Administration (EIA) revealed that U.S. crude stockpiles fell less than expected. For the week ended April 26, the EIA said that crude oil inventories fell by 0.930 million, which was far less than expectations of a draw of 2.333 million barrels.
Russia, contributing the largest production cut outside OPEC, said as of May 1, it had cut output by more than 300,000 bpd since hitting peak production in October. However the latest survey of OPEC production showed the country’s compliance had fallen slightly. OPEC meets on May 25 to discuss extending the agreement. — Neal Bhai Reports