Crude oil futures edged lower to Rs 3,871 per barrel on January 21 as participants increased their short position as seen by the open interest. The crude oil price had gained 0.5 percent yesterday on the NYMEX.
Crude oil prices extended decline after a gap down open in the afternoon session on surging coronavirus cases globally and rise in US crude stockpile.
The American Petroleum Institute (API) reported that US crude inventories rose 2.56 million barrels for the week ended January 15 as against a forecast of 1.2 million barrels decline.
The International Energy Agency (IEA) slashed forecasts for global oil demand in the first quarter by 580,000 barrels per day as countries restrict movements to contain new COVID outbreaks.
“NYMEX crude trades modestly lower near $53 per barrel amid API report that noted a 2.56 million barrels increase in US crude oil stocks as against a forecast of 1.2 mn bbl decline. Also weighing on price is rising virus cases, mixed economic data from major economies and IEA’s downbeat demand outlook. However, supporting price is US stimulus expectations and Saudi’s voluntary production cuts. Crude is yet to break past last week’s 11-month high and choppy trade is likely ahead of inventory report”, said Ravindra Rao, VP- Head Commodity Research at Kotak Securities.