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Oil Today: Oil prices rise as market awaits decision on OPEC to extend production cuts

by xyonent
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Crude oil futures were trading higher on Tuesday morning as markets waited to see whether the Organization of the Petroleum Exporting Countries (OPEC) and its allies (OPEC+) would extend production cuts beyond June 30.

  • Read also:Goldman Sachs predicts oil demand will continue to grow through 2034

As of 9:52 a.m. Tuesday, August Brent crude futures were up 0.27% to $83.10, while July WTI crude futures were up 0.48% to $78.93.

June crude oil futures were trading at Rs 6,567 on the Multi Commodity Exchange (MCX) at opening morning trade on Tuesday, up 0.31 percent from the previous closing price of Rs 6,547, while July crude futures were trading at Rs 6,553, up 0.32 percent from Rs 6,532.

US inflation data later this week

The OPEC+ meeting is scheduled to be held online on June 2. The market is watching to see whether OPEC+ will extend the current production cut of 2.2 million barrels per day beyond the deadline of June 30. Market participants believe that if an extension of the production cuts is announced in the second half of 2024, crude oil prices will rise in the global market.

OPEC+ announced production cuts last year as part of efforts to stabilize market prices.

Meanwhile, the market is also eagerly awaiting US inflation data due to be released this Friday, which will provide an indication of the direction of the Federal Reserve’s future interest rate policy. As long as inflation remains above the Fed’s 2% target, interest rates are expected to remain higher for a longer period.

Several federal officials expressed caution about inflation last week, suggesting that rising inflation rates could make cuts to U.S. interest rates less likely.

High interest rates in the United States affect the prices of commodities such as crude oil, which are traded in dollars.

Besides the US, the market is also awaiting the release of purchasing managers’ index data from China this week. Both the US and China are major consumers of crude oil in the global market.

Zeera, Castor seedlings

June aluminium futures were trading at Rs 246 on MCX, up 1.57 per cent from the previous closing price of Rs 242.20.

On the National Commodity and Derivatives Exchange (NCDEX), June Jeera contract was trading at Rs 28,425 a day in the first hour of trade on Tuesday morning, down 0.58 per cent from the previous day’s closing price of Rs 28,590 a day.

  • Read also:Crude Oil Check: Key Supports Under Test

Castor seed futures for June delivery were trading at Rs 5,675 on the NCDEX in the first hour of trading on Tuesday morning, down 0.18 per cent against the previous day’s closing price of Rs 5,685.

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