Crude oil futures traded higher on Wednesday morning as the industry data showed decline in crude oil inventories in the US for the week ending January 3.
At 9.58 am on Wednesday, March Brent oil futures were at $77.36, up by 0.40 per cent, and February crude oil futures on WTI (West Texas Intermediate) were at $74.69, up by 0.59 per cent.
January crude oil futures were trading at ₹6414 on Multi Commodity Exchange (MCX) during the initial hour of trading on Wednesday against the previous close of ₹6385, up by 0.45 per cent, and February futures were trading at ₹6388 against the previous close of ₹6364, up by 0.38 per cent.
According to the American Petroleum Institute (API), crude oil inventories in the US declined by 4.02 million barrels for the week ending January 3. The market was expecting it to decline by 250,000 barrels during the period.
Meanwhile, Tuesday’s Job Openings and Labour Turnover Survey from the US Labor Department showed layoffs remained low in November. There were 1.13 job openings in November for every unemployed person, up from 1.12 in October.
Market reports said that the survey report and the recent employment data indicate the signs of labour market returning to pre-Covid levels.
US is a major consumer of crude oil in the world market, and an improvement in economic activities in that country will help boost demand for commodities such as crude oil.
A Reuters survey showed that Organization of the Petroleum Exporting Countries (OPEC) produced 26.46 million barrels per day in December, down by 50,000 barrels per day from November. UAE’s production declined by 90,000 barrels per day. The report, which cited a source, said field maintenance was the reason for this decline.
Iran’s output declined by 70,000 barrels per day. Saudi Arabia and Iraq pumped below the implied target covered by supply agreements, it said.
However, Nigeria increased crude oil output by 50,000 barrels per day. Libyan crude oil production also increased by 50,000 barrels per day.
Another Reuters report said that Shandong Port Group of China has banned US-sanctioned tankers from calling into its ports in the eastern Chinese province. The province imported about 1.74 million barrels per day of oil from Iran, Russia and Venezuela last year. The ban could slow imports to China, one of the major consumers of crude oil in the world market, it said.
MCX natural gas futues
January natural gas futures were trading at ₹298.10 on MCX during the initial hour of trading on Wednesday against the previous close of ₹300.60, down by 0.83 per cent.
Guargum contracts
On the National Commodities and Derivatives Exchange (NCDEX), February guargum contracts were trading at ₹10491 in the initial hour of trading on Wednesday against the previous close of ₹10463, up by 0.27 per cent.
April turmeric (farmer polished) futures were trading at ₹15440 on NCDEX in the initial hour of trading on Wednesday against the previous close of ₹15590, down by 0.96 per cent.