Crude oil prices have wiped out almost all risk premiums, lost more than 11% since the Saudi oil facility was attacked on September 14 as Saudi restored most of the production capacity at a faster than expected pace.
Bearish EIA's Weekly Inventory Status Report also weighed on sentiment last night when the report showed a surprise surge in the US Crude oil Inventories by 2.4 million barrels in the week ended September 20, leading to sliding towards $55.5 a barrel in Nymex and Rs3967 in Mcx October future.
Now, Crude oil inventories stand at 419.5 million barrels, which is at 5-Year average. Gasoline inventories increased by 0.5 million barrels last week and, are about 4% above the five year average for this time of year. Distillate fuel inventories decreased by 3.0 million barrels last week and are about 7% below the five year average for this time of year. Refineries operated at 89.8% of their operable capacity last week.
The U.S. production reached an all-time high of 12.5 Mbps last week, another bearish factor for oil.
Looking forward, WTI Crude is likely to trade between $52.5 and $57.5, will be heading towards lower band value. Brent is likely to trade between $57.5 and $63.5, will be heading towards lower band value.
The range for Crude oil Mcx October lies between 3800-4160.
Story by Tarun Satsangi for TarunSatsangi.com