Crude oil prices for most active February expiry at the NYMEX finished on a highly weaker note on Friday as markets took negativity out of the strong rise in US crude oil production whereas the weekly inventory data too disappointed. By the end of trade, WTI crude oil for active contract at was standing below $94 per barrel, lower by 1.55% for the day. In the Indian markets, we saw our prices slipped by just near 2% to Rs 5880 per barrel for January settlement at the MCX. Overall for the week too, we saw oil prices falling down heavily, wherein it was also one of the biggest loser in the non-agricultural commodities space.
Crude prices at the NYMEX fell for all four trading sessions, with the week being a truncated one due to New Year holiday. Though the trading participation was muted oil prices produced a weekly fall for the commodity to over 6% at the NYMEX and around 5% at the Brent.
As also stated in our weekly report, there were some major negative inputs into the commodity from the supply side from OPEC group which pressed oil prices lower. On fresh news from Libya, its National Oil Corp (NOC) said it is planning to restart the El Sharara oilfield wherein the company hopes to enhance the country’s output to near 600,000 BPD.
In other global market cues, today morning Asian markets have fallen over 2% taking weak cues from US on Friday with lower Chinese PMI services number adding on to the negative pressure. The impact is felt on domestic unit, the Indian rupee which is now trading at 62.68 down by 15 paisa against the US dollar.
In Crude, WTI is trading at $94 marginal change from its previous close. We continue to hold a bearish approach on the same however, we also have to be little cautious today as we have the US non-manufacturing Composite index which is expected to improve from 53.90 to 54.60 and might prohibit much fall on oil prices. Already we have seen big drop in oil prices on Friday and last week on a cumulative basis. Overall we have a bearish view into the commodity though prices are likely to trade in a ranged manner. Traders can look for pull-backs to initiated shorts for small targets.