Crude oil traded higher on Wednesday morning as the PMI (Purchasing Managers’ Index) data indicated a recovery in China’s economy.
At 9.52 am, the May Brent oil futures were up by 0.50 per cent at $83.87 and April crude oil futures on WTI were up by 0.48 per cent at $77.42. March crude oil futures were trading at ₹6,402 on the Multi Commodity Exchange (MCX) in early trade against the previous close of ₹6,404, down by 0.03 per cent, and April futures were trading at ₹6,436 against the previous close of ₹6433, up by 0.05 per cent.
Indication of optimism
According to the National Bureau of Statistics of China, the PMI data was at 56.4 in February. China’s PMI was at 52.9 in January. The latest data showed a strong economic recovery in China. The Covid control measures for several months had impacted its economy, affecting the demand for commodities such as crude oil in the world market. China is one of the major importers of crude oil. Recently International Energy Agency (IEA) and OPEC (Organisation of Petroleum Exporting Countries) have also indicated optimism over the demand recovery for crude oil from China.Meanwhile, the US industry data showed increased crude oil inventories. Quoting sources from American Petroleum Institute (API), a Reuters report said that the crude oil inventories increased by 6.2 million barrels in the US for the week ending February 24. This data indicated limited consumption of crude oil in the US market. However, the official data from the US EIA (Energy Information Administration) is expected later in the day. That data will give an idea about the crude oil inventories in the US.
Dhaniya, guar gum slip
March natural gas futures were trading at ₹227.60 on MCX in the initial trade against the previous close of ₹219, up by 3.93 per cent. On the National Commodities and Derivatives Exchange (NCDEX), April dhaniya contracts were trading at ₹7,168 against the previous close of ₹7,302, down by 1.84 per cent. March guar gum futures were trading at ₹12,105 on NCDEX morning against the previous close of ₹12,227, down by 1 per cent.SHARE
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