Mr. Tapan Patel – Senior Analyst (Commodities), HDFC securities
Crude oil prices rallied to one month highs with NYMEX WTI Crude oil rallied by nearly 5% to $31. Crude oil futures prices at MCX for June contract rose by 5% to Rs.2370 by noon session.
Crude oil prices rallied supportive fundamentals with prices ended in green for the third consecutive week. The output cut effects from major oil producers and signs of demand recovery with ease in lockdown measured has supported crude oil prices to trade higher.
The US crude oil and natural gas rigs count has hit all time lows as many of US energy firm have shit productions which has eased supply pressure at physical delivery point at Cushing, Oklahoma.
The NYMEX WTI June contract is set to expire on 19th May 2020 where many traders are expecting high volatility in the prices. However, we do not expect the previous expiry like situation this time as many traders have opt for early rollover to next contract.
We expect oil prices to trade higher with support at $27 and resistance at $34. MCX Crude oil June futures has support at Rs. 2150 with resistance at Rs.2470.