Expect Crude oil to trade negative: Sushil Finance
According to Sushil Finance, expect crude oil prices to trade negative on the back of profit booking after up move.
Oil prices rose slightly on Tuesday as Saudi exports fell and solid demand soaked up some of what is seen as an over supplied market, but Ecuador’s decision to opt out of an OPEC – led supply reduction pact complicated the outlook. Saudi Arabia’s crude oil exports in May fell to 6.924 million barrels per day (bpd) from 7.006 million bpd in April, official data showed on Tuesday. The top oil exporter’s goal remains to stabilize oil markets by drawing down the global inventory overhang, a Saudi industry source familiar with the kingdom’s oil policy said on Tuesday. Meanwhile in a sign of strong demand, data on Monday showed refineries in China increased crude throughput in June to the second highest on record. But many markets are well supplied and oil for prompt delivery is trading at heavy discounts to forward futures in several parts of the world. As a result, crude oil prices are trading at only around half the levels seen three years ago. A deal by the Organization of the Petroleum Exporting Countries with Russia and other non – OPEC producers to cut supplies by around 1.8 million barrels per day until March 2018 has so far failed to tighten the market or push up prices. Although many OPEC countries have restricted production, others including Nigeria and Libya are allowed to increase output.
We expect crude oil prices to trade negative on the back of profit booking after up move.