Technically Crude oil market is getting support at 3306 and below same could see a test of 3270 level, And resistance is now likely to be seen at 3366, a move above could see prices testing 3410.
Crude oil on MCX settled up 0.21% at 3332 giving back early gains after a surprising build in U.S. oil inventories and with investors looking for fresh demand cues in the U.S. on uncertain prospects for President Donald Trump’s proposed tax cuts and spending plans and the tone of summit talks with Chinese President Xi Jinping on starting later in the day in Florida.
Yesterday pressure came under pressure after US crude oil inventories unexpectedly rose last week, adding to record highs despite another drop in gasoline stockpiles. The EIA said inventories rose by 1.6mbls. That’s in contrast to an industry report from the API showing a 1.8mbl decline.
Gasoline inventories fell by around 600,000 barrels, but market expectation were looking for a drawdown of about 1.5 million. Crude oil has been well-supported in recent sessions amid increasing confidence that output cuts by major global oil producers are beginning to rebalance the market.
OPEC agreed in November last year to curb its output by about 1.2mbpd between January and June. Russia and 10 other non-OPEC producers have agreed to jointly cut by an additional 600,000bpd. In total, they agreed to reduce output by 1.8mbpd to 32.5 million for the first six months of the year.
A joint committee of ministers from OPEC and non-OPEC oil producers will meet in late April to present its recommendation on the fate of the pact. A final decision on whether or not to extend the deal beyond June will be taken by the oil cartel on May 25. — Neal Bhai Reports