Crude oil prices fell by 3.35% to close at ₹5,826, driven by easing geopolitical concerns after reports suggested progress towards a ceasefire between Israel and Hezbollah. While optimism grew around conflict resolution, Lebanese officials remained cautious, expressing skepticism over Israeli commitments. In addition, rising U.S. crude inventories and weaker global demand forecasts exerted further pressure on prices. Saudi Arabia's crude exports reached a three-month high of 5.751 million bpd in September, despite a slight dip in production to 8.975 million bpd. However, OPEC’s revised forecast for slower global oil demand growth in 2024 and the International Energy Agency's (IEA) projection of oversupply in 2025 added bearish sentiment.
U.S. crude inventories rose by 0.545 million barrels last week, surpassing expectations, while gasoline stocks increased by 2.054 million barrels, highlighting ample supply. Distillate stocks, however, posted a minor decline of 0.114 million barrels. The EIA's Short-Term Energy Outlook underscored weakening demand growth, revising global oil demand estimates to 1.2 million bpd for 2024, about 300,000 bpd lower than prior forecasts. U.S. oil production is expected to rise to 13.22 million bpd in 2024 but at a slower pace than earlier anticipated.
Crude oil faced long liquidation, with open interest dropping by 7.43% to 10,828 contracts. Prices find support at ₹5,752, with further downside potential to ₹5,678. Resistance is seen at ₹5,959, and a move above this level could drive prices towards ₹6,092.
Trading Ideas:
# Crudeoil trading range for the day is 5678-6092.
# Crude oil prices fell after reports that Israel and Lebanon had agreed to ceasefire.
# The OPEC+ meeting on December 1 is marked to be pivotal as a delay in production normalization is expected.
# Russia's Novak says oil market balanced thanks to OPEC+