Crude oil yesterday concluded with an increase of 1.04% at Rs 5833, driven by geopolitical factors and supply-side dynamics that bolstered prices. The ongoing strikes by Ukraine on Russian energy infrastructure have led Moscow to implement a partial ban on diesel exports until the end of the year, while also extending its ban on gasoline exports, thereby constricting global fuel availability.

Simultaneously, crude oil shipments from Iraq’s semi-autonomous Kurdistan region to Turkey are poised to recommence after a hiatus of 2.5 years, with the potential to contribute an additional 180,000–190,000 barrels per day via the Kirkuk-Ceyhan pipeline. U.S. inventory data offered further backing. Crude stocks decreased by 607,000 barrels to 414.8 million, contrary to expectations of an increase, while gasoline stocks declined by 1.1 million barrels and distillate inventories fell by 1.7 million barrels, underscoring significant product drawdowns.

Nonetheless, crude inventories at Cushing experienced a modest uptick, while refinery throughput advanced by 52,000 barrels per day, even as utilization rates declined to 93%. On the macroeconomic front, OPEC has upheld its optimistic forecast for oil demand growth in 2025, attributing this to robust global economic momentum. The group’s monthly report indicated that OPEC+ crude output increased by 509,000 barrels per day in August, consistent with quota adjustments driven by Saudi Arabia’s initiative to reclaim market share.

From a technical perspective, the market is experiencing short covering, evidenced by a decline in open interest of -1.18% to 10751, alongside a price increase of Rs 60. Support is currently identified at Rs 5751, with a downward breach potentially leading to Rs 5669. Conversely, resistance is positioned at Rs 5909, and surpassing this level may allow prices to approach Rs 5985.