Due to profit-taking, crude oil prices declined 2.17% to close at 7,623 after surging due to surprise declines in crude stocks. According to U.S. government data, oil stockpiles decreased by 2.2 million barrels more than expected, highlighting supply limits brought on both Saudi Arabia and Russia’s output curbs.
Particularly, oil supplies dropped by 943,000 barrels at the Cushing, Oklahoma storage hub, reaching their lowest level since July 2022. The quality and operational levels of the hub’s remaining oil have come under scrutiny due to Cushing’s stockpiles’ continuous decline.
OPEC+ and Saudi Arabia have implemented production cutbacks of 1.3 million barrels per day through the end of the year, which has led to concerns about limited oil supplies as winter approaches. Aside from that, in reaction to a recent rise in fuel prices that was ascribed to increased exports, Russian President Vladimir Putin took steps to stabilize them.
Technically, the market went through a long liquidation period, with open interest falling by -32.32% to 7,682. The cost of crude oil dropped by -169 rupees. The critical support levels are 7,530 and 7,436 while 7,801 is expected to be the resistance level. A test of 7,978 might occur if this resistance is eventually broken.
