Crude trades still sideways, hold nerves for bounce back

The last week's news of WTI and Shale oils (The largest oil manufacturers & exporters of the US) to reduce their production capacity does not seem to impact much on prices. According to the Energy Information Administration's (EIA) weekly data, West Texas Intermediate (WTI) crude for June delivery was trading down about 0.6% at around $56.30 a barrel Wednesday morning. The price bounced higher to around $56.70 (up about 0.2% for the day) immediately after the weekly report was released. The 52-week range on WTI futures is $45.93 to $98.22. WTI has traded above $50 a barrel for more than two weeks so far.

Earlier this month the United States Energy Information Administration (EIA) made a pronouncement that clarifies the insightful nature of the rise in oil and gas production over the last decade, here are some inventory updates by EIA - total gasoline inventories decreased by 2.1 million barrels last week, but remain above the upper limit of the five-year average range. Total motor gasoline supplied (the agency's measure of consumption) averaged over 9 million barrels a day for the past four weeks, up by 4% compared with the same period a year ago. The U.S. crude inventories rose only 1.3 million barrels to 483.69 million, the smallest build-up since the week ending. The Energy Information Administration said on Wednesday, it hit a record level for a 14th consecutive week.

Presently Indian MCX crude is available at ₹ 3561 with current open interest raised by 2595 While on New York mercantile exchange WTI is trading at $ 56.06. We look ahead crude oil prices to trade sideways as rising crude inventories is a cause of concern while strike by Saudi in Yemen raises geo-political tensions in the region.
However, aggressive traders can still eye on below short term trading call and for those who are risk averse either side directional moves should stay out for better confirmation.