Crude oil prices experienced a decline of -1.67%, settling at 6527, driven by concerns about the outlook for energy demand following the decision by the Organization of Petroleum Exporting Countries and its allies (OPEC+) to extend output cuts until the end of the second quarter. Saudi Arabia, OPEC's top producer, committed to extending its voluntary 2-million bpd production cut until the end of June, aimed at maintaining market stability. Additionally, Russia announced an extra reduction of 471,000 bpd in oil production and exports during the second quarter of 2024, coordinating with OPEC+ countries.
Money managers increased their net long U.S. crude futures and options positions in the week of February 27, according to the U.S. Commodity Futures Trading Commission (CFTC). The speculator group raised its combined futures and options position in New York and London, signalling a bullish sentiment in the market. On the supply side, U.S. shipments of crude oil via rail in December saw a notable increase of 35,000 bpd from the previous month, reaching 333,000 bpd, as reported by the U.S. Energy Information Administration.
Technically, the crude oil market observed long liquidation, with a 36.02% drop in open interest to settle at 4585. Prices declined by -111 rupees. Crude oil is currently finding support at 6477, with a potential downside to 6426, while resistance is expected at 6619, and a breakthrough could lead to testing 6710.