By Srinivas Chowdary Sunkara // petrobazaar // 3rd December 2019.
Brent oil futures for February contract rose 43 cents to $60.92 and WTI oil futures gained 79 cents to $55.96 a barrel last night. In Shanghai, Crude oil main contract futures prices dropped by 10.6 Yuan or 2.29% at 451.5 Yuan/barrel while MCX crude futures closed Rs.28 up at Rs.4008 yesterday. Brent premium to WTI narrowed down to $4.96.
The world crude oil price index spiked above 1% after market got a hint that the 'deeper cuts' discussion is taking place among OPEC and allied producers. Rising manufacturing activity in China may spur more demand was also another cause of factor, pushed oil prices up. Gains are capped after a data showed that the U.S factory activity contracted during Nov and Trump talk of reimposing of tariffs also pared the earlier session gains. On the supply side, I do not expect any surprises from scheduled OPEC meeting on Thursday as they don't have an option and either they have to continue to cut or more deeper cuts. On the other hand, with the predicted doom and gloom in the shale next year and the removing the rigs YoY , OPEC will upbeat about their perspective. Turning to weekly data, API estimates are due later today followed by government data tomorrow.
Today morning, Oil futures opened up during the Asian hours and it does not demonstrate any firm trend so far. Currently, Oil prices seems to be fishy to any news or predictions from Vienna. I strongly feel that no surprises will rumble for another crash in the oil market. Good day to all.
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