Crude oil for most active February expiry at the NYMEX finished on a weaker note yesterday and negated the bullish set of inventory number from the US Department of Energy during the Friday’s session. Overall at the NYMEX, WTI active contract slipped 1% to close at $99 per barrel, with volumes also falling by a sixth as trading activity remain subdued ahead of New Year. In the Indian context, we saw crude oil prices at the MCX finishing 1.65% lower to Rs 6158 per barrel as our markets added the extra losses due to appreciation in the Indian Rupee. However, we feel, losses in Indian context have already exceeded the normal movement out of Rupee and we could see moderately positive opening today.
While the US data on the housing sector added to the negative sentiment in the international front, losses were also appended due to the fresh news of supply from Libya. As per the Bloomberg news, Libya resumed production from the Messla field while the Tobruk and Sarir refineries also resumed operation recently. The country is pumping 233,889 barrels of crude a day, compared with a daily capacity of about 1.6 million barrels a day, the oil ministry of Libya said on December 21.
In the other global market cues on Tuesday, most Asian equities are trading on a marginally positive note while US equity indices finished mixed taking cues out of lower participation and also disappointing housing data from the US. Coming to currency space dollar is trading marginally higher today though fell sharply yesterday tracking US pending home sales number. In the major economic cues today, we have the housing price index from the US whereas also the important Chicago PMI number for the the base metals segment and to an extent crude oil. Separately the Consumer Confidence number would also be closely watched as it would set the tone for how the US consumer’s feel about the economy as they enter the highly active Holiday period backed by Christmas and New Year.
Back in the energy segment, Crude oil is trading flattish today after the heavy fall in yesterday’s session. Overall trading participation might continue to be low, as today is New Year Eve. Though we had a moderately bullish outlook into the commodity as per our weekly view, we would look for selling in Intra-day for small opportunities.