Crude Slips From Highs Near Rs 5300

Crude.........

MCX Crude oil futures slipped from the highs today, not failing to hold on around Rs 5300 as a bearish undertone remained in place amid mixed global cues. The commodity had edged up in last session on supportive manufacturing data from Eurozone but gains in the US dollar made the WTI crude pare these gains. Worries over Chinese economy also kept the upside under check. The WTI Crude futures are quoting at $93.33, down 12 cents per barrel on the day. The prices had dropped to their one month low of $91.26 per barrel in last session.

Oil had slipped in electronic session yesterday after the HSBC Chinese manufacturing PMI indicated a continued contraction and led oil lower. The final version of the HSBC China manufacturing Purchasing Managers' Index for May fell to 49.2, down from a preliminary reading of 49.6, and more than a point off from April's 50.4. However, the commodity took a turn around after the euro zone's manufacturing PMI rose unexpectedly last month. In a report, research group Markit said the euro zone's manufacturing PMI rose to 48.3, from 47.8 in the preceding month.

OPEC oil ministers reached quick agreement last Friday on keeping output targets steady but deferred solutions on how to deal with surging U.S. shale oil production and internal rivalries denting the organization's image of unity. The oil cartel's decision on keeping the status quo on production of 30 million barrels a day was expected. The price per barrel for internationally traded benchmark oil is over $100 US, a level most OPEC countries are happy with.

Meanwhile, the US dollar gained against the Euro ahead of the ECB meet during the middle of the week. Dollar is quoting at 1.3068 after falling to its three week low above 1.3100 yesterday. Oil remains vulnerable to another push towards $92 if the US stocks witness-selling pressure amid lack of data. MCX Crude oil futures are quoting at Rs 5276, down Rs 11 per barrel on the day. The open interest in the counter is up 4% on the day.
Source by Commodity Insights