Crude oil futures rose to Rs 2,983 per barrel on September 28 as participants increased their short position as seen by the open interest. Crude oil prices pared early losses and traded green in the afternoon.

The number of rigs drilling crude oil in the US jumped by 17 to 217 last week.

Tapan Patel- Senior Analyst (Commodities), HDFC Securities, said, “Crude oil prices traded lower on weaker demand concerns amid a surge in virus infections in Europe, the US and the UK. The return of oil supply from Libya and Iraq may add pressure to the prices in the coming months.”

“NYMEX crude trades marginally lower near $40/bbl as range-bound move continues. Support from a decline in US crude oil stocks, OPEC’s willingness to take more measures and strike concerns relating to Norway is countered by a rise in US crude oil rig count and demand concerns amid rising virus cases globally and mixed economic data from major economies. Mixed factors may keep crude in a range but bias may be on the upside owing to supply risks,” said Ravindra Rao, VP-Head Commodity Research, Kotak Securities.

In the futures market, crude oil for October delivery touched an intraday high of Rs 2,989 and an intraday low of Rs 2,932 per barrel on MCX. So far, in the current series, black gold has touched a low of Rs 2,718 and a high of Rs 3,320.

Crude oil delivery for October gained Rs 14, or 0.47 percent, to Rs 2,983 per barrel at 16:12 hours IST with a business turnover of 3,175 lots.

Crude oil delivery for November rose Rs 19, or 0.63 percent, to Rs 3,028 per barrel with a business volume of 63 lots.

The value of October and November contracts traded so far is Rs 722.02 crore and Rs 2.12 crore, respectively.

Patel expects crude oil prices to trade sideways to down with support at $38 and resistance at $41. MCX Crude oil October has support at Rs 2,870 and resistance at Rs 3,020.

West Texas Intermediate crude was up 0.65 percent at $40.51 per barrel, while Brent crude, the London-based international benchmark, gained 0.65 percent to $42.61 per barrel.