The price of crude oil yesterday increased by 1.08% to settle at 6726 on signs of tightening global supply, but the increase was restrained by China’s slowing economy and worries about additional U.S. interest rate increases. Unexpected rate cuts by the central bank failed to calm the market as fears about the country’s struggling economy increased in light of weaker-than-anticipated economic statistics and a worsening property sector crisis in China.
The market appears to be tightening as a result of Saudi Arabia and Russia, two major members of OPEC+, reducing production. Investors are continuing to exercise caution. Data from the Energy Information Administration showed that last week, the net input of crude oil by American refiners increased to its highest level since January 2020, when the COVID-19 outbreak reduced demand. To reach 16.7 million bpd in the week ending August, refinery crude runs increased by 167,000 barrels per day.
11, EIA reported. According to data from the U.S. Energy Information Administration, U.S. oil production from the main shale-producing regions is expected to decline in September to its lowest level since May 2023. According to EIA data, U.S. oil production is predicted to decrease to 9.41 million barrels per day (bpd) in September. In July, it reached 9.45 million bpd, the highest level ever.
Technically, the market is experiencing new buying as open interest increased by 43.36% to close at 3733 while prices increased by 72 rupees. Currently, crude oil is receiving support at 6627, and a move below that level could result in a test of the 6529 levels. On the other hand, resistance is now likely to be seen at 6780, and a move above could result in prices testing 6835.
