Thursday, April 21, 2011

Crude oil surges tracking firm global shares

Nymex crude oil surged about 3.4 percent on Wednesday mainly on the back of unexpected sharp decline in the US crude oil inventories and positive sentiments in the global equity markets.
Dollar weakness also supported oil prices further. Prices touched an intra-day high of $111.66/bbl and closed the session at 1n1 1.45/bbl yesterday. However, appreciation of the Indian Rupee resisted further gains on the domestic bourses.
On the MCX, oil prices gained around 1.7 percent and touched an intra-day high of $4984/bbl on Wednesday.
EIA Inventory Data
The US Energy Information Administration (EIA) in its weekly inventory report showed unexpected fall in inventory levels of crude oil.
As per reported figures, crude oil inventories declined sharply by 2.3 million barrels to reach 357 million barrels.
Gasoline stocks declined 1.6 million barrels to 2o8.1 million barrels, whereas distillates also decreased by 2.5 million barrels to reach 148.3 million barrels in the same week.
Outlook
We expect crude oil prices to trade with a positive bias on account of upbeat market sentiments coupled with weakness in dollar.
Courtesy: Angel Commodities