MCX Crude Oil under short covering; Support seen at 3057
Commodity Online | August 05 2020
UPDATED 09:50:58 IST

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Technically Crude Oil market is under short covering as market has witnessed drop in open interest by 1.02% to settled at 1461 while prices up 48 rupees.

Now MCX Crude Oil is getting support at 3057 and below same could see a test of 2963 levels, and resistance is now likely to be seen at 3204, a move above could see prices testing 3257.

Crude Oil yesterday settled up by 1.55% at 3151 on concerns about fuel demand growth as a fresh wave of COVID-19 infections around the world sparks tighter lockdowns just as major producer’s ramp up output.

Russian oil and gas condensate output increased to 9.8 million barrels per day (bpd) on Aug. 1-2 from 9.37 million bpd in July as the country eases production curbs under an OPEC+ deal, a source familiar with data said.

The Energy Ministry declined to comment on the data. Hedge funds turned less bullish on petroleum at the end of July amid anticipated rises in OPEC+ production and growing concerns about the impact of resurgent coronavirus infections on the global economic outlook.

Money managers sold the equivalent of 40 million barrels in the six most important petroleum futures and options contracts in the week ending July 28.

Venezuela exported about 388,100 barrels per day of crude and fuel in July, almost unchanged versus the previous month, as U.S. sanctions on PDVSA continued limiting sales, according to Refinitiv Eikon and internal data from the state-run company.

Washington has ramped up pressure this year on PDVSA's customers, trade partners and shippers aiming to stop the re-sale of Venezuelan oil and block efforts to hide or change its country of origin.

Trading Ideas:
--Crude Oil trading range for the day is 2963-3257.
--Crude Oil gained with traders picking up positions ahead of inventory data on hopes of a drop in stockpiles.
--Russia is raising oil output as OPEC+ cuts ease.
--Venezuela's oil exports stagnant in July at below 400,000 bpd.

Courtesy: Kedia Commodities