Crude oil futures fell 0.39% to Rs 2,826, WTI trades below $39 a barrel

Crude oil futures traded lower at Rs 2,826 per barrel on October 5 as participants increased their short positions as seen by the open interest.

Crude oil prices gained in the international market following the comments from doctors treating US President Donald Trump, indicating that he could be discharged from hospital.

However, weighing on the oil price is the return of additional crude from Libya following the lifting of the export blockade in a well-supplied market amid demand concern.

The number of rigs drilling crude oil in the US rose by 6 to 189 rigs, the highest since June said Baker Hughes in a weekly report.

MCX iCOMDEX Crude Oil Index fell 12.87 points, or 0.39 percent, at 3,305.81 at 15:36.

“Crude oil prices pared losses on positive global cues on news that US President may be discharged from hospital as soon as Monday, just a few days after his positive COVID-19 test. Growing supplies and weaker demand may cap upside limited in oil prices after a speculative rally,” said Tapan Patel, senior analyst (commodities), HDFC Securities.

"NYMEX crude has risen over 4 percent to trade near $38.5/bbl after a 4.3 percent decline on Friday. Crude edged up as equity markets steadied on the possibility that President Donald Trump may be able to leave hospital as soon as Monday. Also supporting the price is the ongoing labour strike in Norway. However, weighing on price is mixed US economic data, rise in US crude oil rig count and higher OPEC supply. Crude may witness choppy trade amid mixed factors, however, general bias may be on the downside owing to concerns about health of the US economy," said Ravindra Rao, VP-Head Commodity Research at Kotak Securities.

In the futures market, crude oil for October delivery touched an intraday high of Rs 2,831 and an intraday low of Rs 2,760 per barrel on the 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 slipped Rs 11, or 0.39 percent, to Rs 2,826 per barrel at 15:41 hours IST with a business turnover of 2,875 lots.

Crude oil delivery for November dropped Rs 11, or 0.45 percent, to Rs 2,866 per barrel with a business volume of 139 lots.

The value of October and November’s contracts traded so far is Rs 856.89 crore and Rs 1.39 crore, respectively.

Patel expects crude oil prices to trade sideways to down with support at $37 and resistance at $40. MCX Crude oil October has support at Rs 2,690, resistance at Rs 2,870.

West Texas Intermediate (WTI) crude was up 3.94 percent at $38.51 per barrel, while Brent crude, the London-based international benchmark rose 3.54 percent to $40.66 per barrel.