MCX Crude oil futures are expected to open higher in the first session of the week as the commodity surges well above $79 per barrel in the global markets, hitting two month highs and cutting its intraday losses in last session quite comprehensively. Crude oil witnessed a very good upmove in last week, gaining around 4%. Crude oil futures crashed below $ 76 a barrel amid lingering uncertainty in the wake of the less-than-hoped-for U.S. economic data but was very well supported on weakness in the US dollar and falling gasoline inventories in the US.
The rebound in the prices was a result of bounce back in the global equity markets and appreciation in the single currency to 4-week highs against the US dollar. Dollar fell further today; dropping to lows of 1.2448 against the Euro. The US gasoline inventories are at a six-week lows right now, providing a boost to oil as the peak summer driving season nears.
However, the weak economic data from US might curb the rally in oil from hereon as the $80 levels approach. The US Labor Department said that the number of Americans seeking jobless benefits last week climbed to a one-month high. The markets may also eye data stating that U.S. fuel consumption fell 0.9 percent to the lowest level in five weeks in the seven days ended June 11, the Energy Department reported June 16.
The global prices rallied to a high of $79.42 per barrel today and currently trade at $ 79.39, up $1.13 per barrel from the previous close. The commodity is expected to face critical headwinds once the $80 levels come within striking distance. DOW futures are up 80 points and world markets seem to be basking into the positive current of Chinese Yuan appreciation.
MCX Crude oil futures for June, which are about to expire on 21st June, slid under Rs 3500 per barrel before bouncing back, extend its upmove. The MCX July futures are expected to hold above Rs 3600 per barrel mark with the critical barriers being Rs 3652-60 and Rs 3680 in today`s session. The counter ended at Rs 3614 per barrel on Saturday.
Source : Capital Market