Crude Oil Remain Under Pressure and Commodity Trading Tips
Crude Oil Commodity Weekly Trading Review and Outlook: Crude oil prices this week started on a negative note driven down by a series of important economic events along with some downside intrinsic fundamentals. International crude oil prices declined continuously for six trading sessions from 9th June – 16th June With weakness in dollar and subsiding Brexit fears, finally the crude oil was able to show some short coverings on Friday. As per Friday’s closing, WTI International and Brent crude oil posted gains around 5% each, ending the week at $48.86/bbl & $49.25/bbl. July contract MCX crude oil posted gains around 2%, ending the week at Rs.3246/bbl Though, on weekly basis, the calculation remained on downside, showing around 1.40% loss in WTI International and around 2.50% loss in Brent crude oil. Weekly losses in July contract MCX crude oil showed losses more than 3%. With a series of major economic events from U.S. interest rate hikes and Britain’s exit from the Euro zone, International crude prices crashed from its 2016 high levels. Despite of having much better than expected inventory data, crude oil failed showing any positive response. Though, having weaker jobs generation data in May month, it was likely that interest rates could be hiked in this month but still the traders were cautious, which fueled up dollar and weighed on the denominated commodities. Britain’s exit from the Euro zone had its own impact fearing of declining demand from the Europe and losing strength in Euro which could adversely fuel dollar. Apart from this, coming to the normal crude fundamentals, the weekly DoE inventory data was quite impressive, still the prices were not being able to hold upside move. Before the weekly inventory data, a day before API released its weekly data, which was quite negative and that pressurized crude oil prices further Crude Oil Commodity Trading Analysis: Crude oil stocks last week went down for the fourth continuous week, though the rate of drawdown got lowered on account of decline in weekly crude oil demand by more than 2.50%. Gasoline stocks went down much more than expected as the weekly demand for the same inside the United States domestic market surged by around 2%. Distillate stocks went up for the second consecutive week, though the injections got lessen as the weekly demand surged more than 5%. Refinery inputs declined by around 100,000 barrels per day, and due to this the crude stocks demand got lowered. On account of less output and high demand for gasoline its stocks went down. This summer season the refiners are facing lower crack margin problems, which have reduced their profitability. Gasoline and distillate stocks are running at near about same prices, which normally the former should have been in premium. Huge chances are there for significant increase in products side glut, which will pressurize crude oil prices. The most supportive data was the weekly crude oil production levels. The same was being anticipated to rise as the rig counts went up, but instead 29,000 bpd lower production was observed. Current levels of production in the U.S. average around 8.716 MBPD.