Technically Crude Oil market is under long liquidation as market has witnessed drop in open interest by 17.57% to settled at 13002 while prices down 81 rupees.
Now MCX Crude Oil is getting support at 3596 and below same could see a test of 3554 level, And resistance is now likely to be seen at 3697, a move above could see prices testing 3756.
Crude Oil on MCX settled down -2.18% at 3639 after the International Energy Agency (IEA) revised down its forecast for global demand growth and said it expects U.S producers to ramp up output.
Crude prices came under pressure after the EIA revealed a somewhat downbeat outlook for oil demand in its monthly report, forecasting weakness in global demand growth, while warning that global oil markets will be oversupplied through the second quarter of 2018.
The IEA cut its oil demand growth forecast by 100,000 barrels per day (bpd) for this year and 2018, to an estimated 1.5 million bpd and 1.3 million bpd, respectively, as warmer temperatures were expected to weigh on consumption while rising output might add to glut in the crude supplies.
The reported said, however, that OPEC member compliance with deal to curb output improved, rising to 96% in October from 87% in September. In May, OPEC producers agreed to extend production cuts for a period of nine months until March, but stuck to production cuts of 1.2 million bpd agreed in November last year. U.S. crude oil inventories rose 6.531 million barrels last week, the American Petroleum Institute said, missing expectations for a draw, while gasoline supplies increased by 2.399 million barrels and distillates fell by 2.572 million barrels.
Crude oil stocks in the U.S. were seen down 2.850 million barrels, while distillates were expected to post a drop of 1.775 million barrels and gasoline inventories expected down 1.025 million barrels.
--Crude Oil trading range for the day is 3554-3756.
--Crude Oil dropped after the International Energy Agency cast doubts over the past months’ narrative of tightening fuel markets.
--The IEA cut its oil demand growth forecast by 100,000 bpd for this year and next, to an estimated 1.5 million bpd in 2017 and 1.3 million bpd in 2018.
--The IEA said non-OPEC production will add 1.4 million bpd of additional production in 2018.
Courtesy: Kedia Commodities