Crudeoil on MCX settled up 1.68% at 3579 following a late-session surge on the back of data showing signs of U.S. production tightening as US oil rig counts fell to a nearly six-month low. Crude oil settled at two-year highs amid a spike in sentiment on oil prices after the number of oil rigs operating in the US fell by eight to 729, declining for the fourth week in five, according to data from energy services firm Baker Hughes.
That was the first time since May 26 that oil rig counts fell below 730, fueling expectations that market rebalancing is well underway as data earlier this week showed OPEC members continued to cut output. Saudi Arabia continued to cut oil output as inventories declined significantly in October, Saudi Energy Minister Khalid Al-Falih said, describing compliance with the OPEC-led accord to curb output as “excellent.”
Russian also adhered to the cuts stipulated in the output-cut agreement despite increasing output to 10.93 million bpd in October from 10.91 million bpd in September, official data showed. In May, OPEC producers agreed to extend production cuts for a period of nine months until March, but stuck to production cuts of 1.2 million bpd agreed in November last year.
The rally in crude oil prices comes as investor optimism on an extension of the OPEC-led agreement following recent comments from both OPEC and non-OPEC officials ahead of the OPEC meeting in Vienna on Nov. 30.
Technically market is under fresh buying as market has witnessed gain in open interest by 17.61% to settled at 19257 while prices up 59 rupees, now Crudeoil is getting support at 3537 and below same could see a test of 3496 level, And resistance is now likely to be seen at 3604, a move above could see prices testing 3630.
* Crudeoil trading range for the day is 3496-3630.
* Crude oil prices settled higher on the back of data showing signs of U.S. production tightening as US oil rig counts fell to a nearly six-month low.
* The number of oil rigs operating in the US fell by eight to 729, declining for the fourth week in five
* Russia said the deal, due to expire in March, could be extended but a decision was not imminent.