The news that Saudi Arabia and Russia would prolong their voluntary production curbs until next month helped crude oil settle yesterday 1.45% higher at 6859. In addition, Russia announced it will decrease its oil exports by 300,000 bpd in September. Saudi Arabia stated it would prolong its 1 million barrels per day output reduction for one additional month.
Due to higher refinery runs and robust crude exports, U.S. crude stockpiles also dropped by a record 17 million barrels last week, but at 439.8 million barrels, they are still just 1% below the five-year average for this time of the year. According to the Russian Deputy Prime Minister, the market is balanced due to strong demand, which is expected to increase global oil demand by 2.4 million barrels per day this year.
9.5 million barrels of oil are produced in Russia per day, according to him, following a meeting of the joint monitoring committee of OPEC and non-OPEC countries.”Russia is fully committed to the agreements that had been reached, and generally, within OPEC+, we are in complete compliance with our obligations,” Novak said. OPEC+’s top ministers met in a panel setting and decided to maintain the oil output policy.
Technically, the market is seeing new buying as open interest increased by 6.77% to settle at 10143 while prices increased by 98 rupees. Currently, Crude oil is receiving support at 6776 and a move below that level could result in a test of the 6694 levels. On the other hand, resistance is now likely to be seen at 6909, and a move above that level could result in a test of 6960 levels.
