US oil sector in focus, NSE launches Brent Oil Contract & domestic castor crop output may fall 20%

23rd Feb – 01st Mar

1. US oil imports drop to a 23 year low

Mar 01, 2019

OPEC members Saudi Arabia and Venezuela cut their shipments to the U.S. to unusually low levels. Weekly crude imports fell 1.61 million barrels a day to 5.92 million, the lowest levels since 1996. Weekly imports from Saudi Arabia fell to 3,46,000 barrels a day for the week ending February 22, the Energy Information Administration reported on Wednesday.

Source: Economic Times

2. US Crude oil production skyrocketed to 12.1 million barrels a day

Mar 01, 2019

U.S. crude oil production increased during the week ending Feb. 22, the U.S. Energy Information Administration (EIA) said on Wednesday. According to the EIA, the weekly U.S. production of crude oil averaged 12.1 million barrels per day (b/d), up by 100,000 b/d from the previous week and up by about 1.8 million b/d year-on-year.

Source: Economic Times

3. NSE launched Brent oil crude oil on 1st March

Mar 01, 2019

The NSE is offering Brent oil contract. This makes all the major crude oil variants available for hedging to Indian players. The bourse launched two cash-settled futures products – 100 barrel Brent crude oil futures and 10 barrels Brent crude oil mini futures. The trading session for both the futures will be between 9:00 a.m. and 11:30 p.m. from Monday to Friday. The initial margin on this contract would be a minimum 4% or based on SPAN margin system, whichever is higher.

Source: Business Standard

4. US Crude oil inventory drops on slowing crude imports from OPEC

Feb 27, 2019

U.S. crude stockpiles fell 8.6 million barrels last week, in contrast to expectations for an increase of 2.8 million barrels, government data showed. The drawdown, which breaks five consecutive weeks of builds, was due to net crude imports slowing to a record low of 2.6 million barrels per day in the wake of declining OPEC production and U.S. sanctions against Venezuela.

Source: Reuters

5. President Trump tweeted on higher oil prices

Feb 25, 2019

U.S. President Donald Trump has warned OPEC not to tighten the oil market too much and risk another spike in prices that could harm the global economy and his re-election campaign in 2020. “Oil prices getting too high,” the President warned in a message posted on Twitter on Monday - "OPEC please relax and take it easy. World cannot take a price hike – fragile!"

Source: Reuters

6. Palladium above $1,550 an ounce on demand from auto industry

Feb 26, 2019

Palladium broke past $1,550 an ounce for the first time on Tuesday on the back of an intensifying supply deficit. Palladium is up based on the fact that there are 15 mining firms in South Africa that could go on strike this week. Tighter emission regulations in all major markets and low primary supply would widen the metal’s deficit in 2019.

Source: Reuters

7. Gold steadied after Fed comment

Feb 26, 2019

Gold steadied after U.S. Federal Reserve Chairman Jerome Powell reiterated the Central Bank’s patient stance in further rate hikes. Lower interest rates reduce the opportunity cost of holding non-interest bearing gold and weigh on the dollar.

Source: Reuters

8. Castor crop output may fall by 20% and castor seed area may fall by 7% in2018-19

Feb 26, 2019

As per government reports, castor seed area is projected to decline by 7% to 769,570 hectares in 2018-19 in comparison to 821,600 hectares from 2017-18. A private survey estimated a drop of 20% in castor seed production this year to 11.26 lakh tonnes from 14.16 lakh tonnes, which may support prices in the short term as demand remains intact.

Source: Financial Express