Mr. Sriram Iyer, Senior Research Analyst at Reliance Securities
International crude oil prices crashed on Monday after weak economic data from China and the United States, the world's top oil consumers, and higher crude output from OPEC producers stoked fears of weakness in oil demand and oversupply.
Domestic crude oil prices also crashed on Monday, tracking weak overseas prices.
China's factory activity growth slipped sharply in July as demand contracted for the first time in more than a year, a survey showed on Monday.
U.S. manufacturing activity also showed signs of slowing. The ISM's index of national factory activity fell to 59.5 last month, the lowest reading since January, from 60.6 in June.
Also weighing on prices, a Reuters survey found that oil output from the Organization of the Petroleum Exporting Countries (OPEC) rose in July to its highest since April 2020 as the group further eased production curbs under a pact with its allies while top exporter Saudi Arabia phased out a voluntary supply cut.
The latest estimates indicate that total OPEC+ production averaged 40.6 million b/d in July, up from 39.6 million b/d in January.
However, markets were also worried about the rise in Covid-19 infections and the risk it possesses to the demand recovery, particularly in countries where vaccination rates are still low.
International crude oil prices have started marginally higher this Tuesday morning in Asian trade as investors could look to the inventories this week.
API will report data tonight, while EIA will report data tomorrow.
Technically, WTI Crude Oil has given a sharp correction from $73.50 & is trading below 21-Daily Moving Average which is placed at $72.40 level below which could see $69.75-$68.35 levels. Resistance is at $71.70-$72.10 levels.
Domestic crude oil prices could start marginally higher this Tuesday morning, tracking overseas prices.
Technically, MCX Crude Oil was unable to break above 5500 levels and has given a sharp correction up to 5255 levels indicating a Bearish Reversal in the counter. Support is at 5260-5200 levels. Resistance is at 5335-5370 levels.
International Natural gas prices ended higher on Monday after bouncing from its lows on Friday on warm weather forecast.
Domestic Natural gas prices also ended higher on Monday, tracking overseas prices.
The weather is expected to be warmer than average throughout most of the country.
International Natural gas prices have started higher on Tuesday morning in Asian trade.
Technically, NYMEX Natural Gas could trade in a range of $3.900-$4.100 levels.
Domestic Natural gas prices could start higher on Tuesday morning, tracking firm overseas prices.
Technically, MCX Natural Gas Aug holds a strong support near 293-290 levels. Resistance is at 297-300 levels.
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