11.4 C
Monday, June 5, 2023

Oil Extends its Slide, and Natural Gas Keeps an Upward Trend

Must read

Oil Extends its Slide, and Natural Gas Keeps an Upward Trend


    Crude oil prices slipped amid investors confusion about OPEC+ decision.
    Natural gas added 0.30% at $3.67 per mmBtu in New York.
    Gold futures are trading flat after US weekly jobless claims.
    Silver futures for September delivery increased by $0.044 at $26.315 an ounce.
    Corn and Soybeans futures closed higher on CBOT due to increased demand for US crops.

Oil Increases Losses After OPEC and UAE Deal

OPEC’s compromise with the UAE, agreeing to raise the amount of oil the group member can eventually pump, did not positively reflect oil prices. The prices of the commodity extended losses on Thursday. Brent crude slipped by 1.5% or $1.11, to $73.65 a barrel, and WTI crude declined by 1.7%, $1.21, at $71.92.

Talks among OPEC and its allies had broken down after UAE opposed extending the group’s supply pact beyond April 2022. The ministers of the cartel postponed oil output talks on Monday. Some sources claim an output increase will not happen in August. Meanwhile, others said the group would have a meeting in the coming days, resulting in an output increase in August.

However, a decision has not been made yet, and discussions remain. Avtar Sandu, a senior commodity trader at Phillips Futures, stated that traders might want to earn some money before the deal is concrete. 

Goldman Sachs, Citi and UBS analysts expect a supply deficit in the coming months even if OPEC and its allies agreed to extend production. UBS analysts claim that Brent could reach $80 per barrel and WTI to $77 per barrel in the coming months in the demand growth outpacing supply growth scenario.


Natural gas prices are set to soar due to supply shortage

Summer heat and tight supplies boosted natural gas prices this summer. Moreover, pipeline issues have curbed production recently. 

In New York, the natural gas price was trading with an increase of 0.30% at $3.67 per mmBtu.

On the MCX, natural gas contracts for July delivery gained Rs 1.40, or 0.51%, to Rs 274.10 per mmBtu.

Gas delivery for August surged by Rs 1.10, or 0.40%, to Rs 273.60 per mmBtu.

MCX iCOMDEX Natural Gas Index rose by 13.44 points or 0.40% to 3,343.74. 

According to Sriram Iyer, Senior Research Analyst at Reliance Securities, support for MCX Natural Gas for July delivery stands near Rs 271-Rs 268 levels. Meanwhile, resistance holds at Rs 275-Rs 278 levels.

Gold holds flat after US weekly jobless claims

Gold prices were trading flat on Thursday. The precious metal did not react to the drop of US weekly jobless claims, registering a more than expected decline. 

August gold futures were trading almost flat at $1,825.40 an ounce. 

According to a Philly Fed survey, the new orders index for gold slipped to 17, compared to June’s reading of 22.2.

However, analysts claim that technically gold futures bulls have near term technical advantage. The next price objective for the bulls is to create a close above the $1,850.00 resistance level. As for bears, the next near term price objective is to push futures prices below the support level of $1,775.00. The yellow metal holds first resistance level at $1,835.00 and then at $1,850.00. As for support, the first support is observed at $1,810.00 and then at $1,800.00.

 Silver is trading steadily

September Comex silver increased by $0.044 at $26.315 an ounce.

The next upside price objective for the silver bulls is above the resistance level of $28.00 an ounce. Meanwhile, the downside price objective is creating close below $25.58, the June low. The first resistance for the metal stands at $26.575 and then $26.91. The next support is at $26.00 and then $25.82, last week’s low.

Corn Comes Calling CommodityCorn and soybeans rose amid solid demand 

The corn market has been in the operator’s focus today. The solid number of buyers were mainly concentrated on the segments with short deliveries. 

In the Chicago market, corn futures closed higher due to solid demand in world markets. China’s corn imports rose by almost 319% in the first half of 2021. 

According to a USDA quarterly report, forecasts show corn plantings will increase to 93.8 million acres from 91.1 million acres, estimated in March. 

The nightmare scenario for investors to consider now is that the Great Plains and parts of the Midwest are facing drought conditions. In fact, forecasts show more heat in the days ahead. Given these circumstances, the crops may struggle to beat record yields.

Soybean futures also closed higher in Chicago due to significant demand for US stock. In the soybean market, the open offer to buy the available commodity and fixations by the industry remained unchanged.

As in the previous sessions, there were no open purchase conditions for the soybean.

The post Oil Extends its Slide, and Natural Gas Keeps an Upward Trend appeared first on FinanceBrokerage.

Source link

More articles

Latest article