Crude Inventories Down, Lows Tested

Crude trading range for the day is 4848-5052. Technically the market is getting support at 4893 while below could see a test of the 4848 level. Resistance is likely at 4995, a move above which could see prices testing 5052. In the U.S., Congress unanimously approved a new package of sanctions against Iran over its disputed nuclear program, which aims to penalize banks as well as insurance and shipping companies helping Tehran sell oil.

Crude oil fell sharply nearly by -0.86% to settle at 4938 after ECB President Draghi disappointed investors hoping for decisive monetary policy action to contain the debt crisis in the euro zone.

Oil remained somewhat supported following a report from the U.S. EIA showing that oil inventories decreased by 6.5mbls last week, far more than forecasts for a decline of 0.7mbls and the largest weekly drawdown since December.

Nymex Crude oil prices decline around 2% yesterday on the back of unfavourable economic data from the U.S. coupled with strength in the DX. Additionally, disappointment from Draghi, who failed to take any immediate action on the euro-zone's debt crisis also exerted downside pressure on crude.

WTI Crude oil futures tumbled, as market participants remained deprived of any further monetary stimulus from Europe and the U.S. A hefty drawdown in U.S. domestic oil stocks failed to provide any substantial support for prices. In the meantime, maintenance work in the British sector of the North Sea will lead to a cut in Crude-oil production in September.

Yesterday's Close
Crude oil prices touched an intraday low of $86.92/bbl and closed at $87.13/bbl in yesterday’s trading session. On the domestic bourses, prices declined by 0.9% and closed at Rs.4,938/bbl after touching an intraday low of Rs.4,905/bbl on Thursday. However, depreciation in the Indian Rupee cushioned a sharp fall in prices on the MCX.

Natural Gas Trading Patterns And Ideas For The Day
Natural gas trading range for the day is 159.5-181.7. The market is looking to take support at 163.5, and a break below could see a test of 159.5 while resistance is likely to be seen at 174.6. A move above could see prices testing 181.7. Natural gas accounts for about a quarter of U.S. electricity generation. In yesterday's trading session, Natural gas touched a low of 166.6 after opening at 175.7, finally settling at 167.5.

Natural gas yesterday traded with the negative node and settled -4.84% down at 167.50 after US government data showed that inventory levels rose more than expected last week, fuelling concerns over a supply glut. Sparking the selling, the EIA said that Natural gas in storage grew by 28bcf to 3.217 tcfeet for the week ended July 27.

Nymex Natural gas prices decline around 7.5 percent yesterday on account of more than expected rise in US Natural gas inventories. Additionally, a stronger DX also acted as negative factor for the prices. Gas prices touched an intraday low of $2.912/mmbtu and closed at $2.917/mmbtu on Thursday. On the domestic front, prices decline by 4.6 percent and closed at Rs.167.5/mmbtu after touching an intraday low of $166.6/mmbtu in yesterday’s trading session. Depreciation in the Indian Rupee prevented further fall in prices in Indian markets.