Crude oil declines as US producer index grows more than expected

Crude oil futures traded lower on Friday morning as the US producer price index (PPI) grew stronger than expected in February.

At 9.52 am on Friday, May Brent oil futures were at $85.26, down by 0.19 per cent, and April crude oil futures on WTI (West Texas Intermediate) were at $81.12, down by 0.17 per cent.

March crude oil futures were trading at ₹6,724 on Multi Commodity Exchange (MCX) during initial trading on Friday morning against the previous close of ₹6,742, down by 0.27 per cent, and April futures were trading at ₹6681 against the previous close of ₹6,698, down by 0.25 per cent.

Making crude oil costly

Data released by the US Bureau of Labour Statistics showed that the PPI witnessed 1.6 per cent growth in February against 1 per cent in January. The market was expecting it to grow by 1.1 per cent during February.

Taking this data into account, market reports noted that the US Federal Reserve may continue with the current interest rates for long and delay its reduction. Higher interest rates make commodities such as crude oil costly in the international market impacting its demand.

Meanwhile, crude oil price got support from the March Oil Market Report of the International Energy Agency (IEA). The report said that the global oil demand is forecast to rise by a higher-than-expected 1.7 million barrels a day in first quarter of 2024 on an improved outlook for the US and increased bunkering. While 2024 growth has been revised up by 110,000 barrels a day from last month’s report, the pace of expansion is on track to slow from 2.3 million barrels a day in 2023 to 1.3 million barrels a day, as demand growth returns to its historical trend, it said.

According to the report, world oil production is projected to fall by 870,000 barrels a day in the first quarter of 2024 against fourth quarter of 2023 due to heavy weather-related shut-ins and new curbs from the OPEC (Organization of the Petroleum Exporting Countries) and its allies, known as OPEC+, bloc. From the second quarter, non-OPEC+ is set to dominate gains after some OPEC+ members announced they would extend extra voluntary cuts to support market stability. Global supply for 2024 is forecast to increase 800,000 barrels a day to 102.9 million barrels a day, including a downward adjustment to OPEC+ output, it said.

Jeera crackles, turmeric loses sheen

March natural gas futures were trading at ₹145.40 on MCX against the previous close of ₹143.30, up by 1.47 per cent.

On the National Commodities and Derivatives Exchange (NCDEX), April jeera contracts were trading at ₹24,450 against the previous close of ₹24,330, up by 0.49 per cent.

April turmeric (farmer polished) futures were trading at ₹18,602 on NCDEX against the previous close of ₹18,744, down by 0.76 per cent.



Crime Today News | Markets | Commodities | Forex | Stocks

Source | Powered by Yes Mom Hosting
Crime Today News Agency

Crime Today News

Welcome to Crime Today News, your trusted source for timely and unbiased news coverage. Since our inception in 2014, we have been dedicated to delivering the latest updates to our valued readers and viewers across Telangana.

Related Posts