Crude oil futures slip 0.59% to Rs 3,209, Brent trades below $45 a barrel

Crude oil futures edged lower to Rs 3,209 per barrel on August 20 as participants increased their short positions. Prices slipped on a gloomy outlook by the US Federal Reserve and less-than-anticipated decline in US crude inventory.

The US Energy Information Administration (EIA) reported that US crude declined by 1.6 million barrels for the week-ended August 14 against the expectation of a decline of 2.6 million barrels.

The OPEC+ alliance urged members to adhere to limiting output as the coronavirus pandemic threatens a demand recovery.

“The range move in crude oil is still intact amid mixed factors. The bounce back in the US Dollar Index has capped gains. Also, weighing on price was the US EIA weekly inventory report, which was largely mixed to negative. OPEC review meeting also failed to impact crude prices. So all in all, gains in oil might be in check as bears have a slight edge in today’s (August 20) session,” said Ravindra Rao, VP- Head Commodity Research at Kotak Securities.

In the futures market, crude oil for September delivery touched an intraday high of Rs 3,223 and a low of Rs 3,204 per barrel on the Multi-Commodity Exchange (MCX). So far in the current series, black gold has touched a low of Rs 2,945 and a high of Rs 3,285.

Crude oil futures for September delivery slipped Rs 19, or 0.59 percent, to Rs 3,209 per barrel at 15:20 hours IST on a business turnover of 3,820 lots.

The value of September's contract traded so far is Rs 333.89 crore.

Tapan Patel- Senior Analyst (Commodities), HDFC Securities, expects oil prices to trade sideways to down for the day with support at $41 and resistance at $43.50 "MCX September Crude Oil futures has support at Rs 3,140, with resistance at Rs 3,250."

West Texas Intermediate crude slipped 1.14 percent at $42.62 per barrel, while Brent crude, the London-based international benchmark, was down 1.10 percent to $44.87 per barrel.