Crude oil dips on hopes OPEC members will increase output

Amid hopes thata few OPEC+ cartel members might increase production, crude oil futures ended lower in the global markets on Thursday morning.

At 10.02 am on Thursday, August Brent oil futures were quoted at $114.26, down by 1.15 per cent, and July crude oil futures on WTI were at $113.03, down by 1.93 per cent.

June crude oil futures were trading at ₹8,786 on Multi Commodity Exchange (MCX) in the initial hours of Thursday morning against the previous close of ₹9,013, down by 2.52 per cent, and July futures were trading at ₹8,633, as against the previous close of ₹8,843, down by 2.37 per cent.

The Financial Times reported that Saudi Arabia is ready to increase oil production should Russian output decline substantially due to western sanctions. Citing a diplomatic source, the report said discussions were held about an immediate increase in output from Saudi Arabia and the UAE. It said this could be announced at the meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its allies later on Thursday.

Suspending Russia from OPEC+?

A recent report in TheWall Street Journal said some OPEC members were exploring the idea of suspending Russia from the OPEC+ production deal. OPEC and its allies such as Russia form OPEC+.

Citing two sources, a Reuters report said that Wednesday’s technical meeting of OPEC+ did not discuss the idea of suspending Russia from the deal

Earlier this week, the European Union (EU) announced it had decided to ban import of crude oil from Russia, cutting it by 90 per cent by the end of 2022. However, it temporarily exempted crude oil delivered from Russia by pipeline.

Some reports stated that the EU failed to agree on a sanctions package against Russia on Wednesday after Hungary raised new demands.

Zinc up

June zinc futures were trading at ₹334.20 on MCX in the initial hours of Thursday morning against the previous close of ₹330.80, up by 1.03 per cent.

On the National Commodities and Derivatives Exchange (NCDEX), June steel long futures were trading at ₹47,000 in the initial hours of Thursday morning against the previous close of ₹46,720, up 0.60 per cent.

June’s guarseed contracts were trading at ₹5,743 against the previous close of ₹5,769, down 0.45 per cent.

Published on

June 02, 2022

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