Crude oil prices trade higher; MCX crude likely to hit ₹7,800 per barrel

At 1:40 pm, crude oil prices were trading 0.27% higher at ₹7,405 per barrel on MCX. Crude oil price opened at ₹7,372 a barrel as compared to its previous close of ₹7,385 on the bourse.

International crude oil prices rose, firming around a 10-month peak, as the market balanced supply concerns over Libya output and OPEC cuts with global macroeconomic headwinds.

Benchmark Brent futures gained 0.48% to $92.50 a barrel, while US West Texas Intermediate (WTI) crude rallied 0.55% to $89.33 a barrel.

Both benchmarks surged nearly 2% on Tuesday to close at their highest levels since November 2022.

Also Read: Oil sizzles at 10-month high on Saudi, Russia output cuts, OPEC upbeat on demand; Brent over $91/bbl

In its latest monthly oil market report for September, the Organisation of Petroleum Exporting Countries (OPEC) revised down the global oil demand for 2023 by 1 lakh barrels per day to 29.2 million barrels per day (bpd) – which is 8 lakh bpd higher than 2022, Reuters reported.

The oil cartel has also cut the 2024 demand outlook by 1 lakh bpd to 30 million bpd.

“The extended oil production cuts from Saudi Arabia and Russia will lead to the next round of uptrend in crude oil prices. Worries over tightening supply will keep oil prices elevated and the sentiment for MCX crude oil remains bullish,” said Amit Sajeja, VP Research – Commodities & Currencies at Motilal Oswal Financial Services.

Saudi Arabia and Russia had earlier extended voluntary supply cuts of a combined 1.3 million bpd to year end. 

Also Read: IOCL, BPCL, HPCL’s gross refining margins to remain in the range of $9 to $10 bbl: CareEdge

Meanwhile, the EIA said global oil inventories were expected to fall by almost a half million bpd in the second half of 2023, causing oil prices to rise with Brent averaging $93 per barrel in the fourth quarter, Reuters reported.

“WTI crude may hit $95 per barrel, while MCX crude is seen testing ₹7,800 levels. Support for WTI crude is seen at $82 a barrel and MCX crude may find support at ₹7,100 level,” Sajeja added.

(With inputs from Reuters)

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Updated: 13 Sep 2023, 01:55 PM IST