Crude oil futures traded lower on Monday morning as the market players awaited interest rate outlook by the US Federal Reserve later this week.
At 9:54 am on Monday, February Brent oil futures were at $74.28, down by 0.28 per cent, and January crude oil futures on WTI (West Texas Intermediate) were at $70.55, down by 1.04 per cent.
December crude oil futures were trading at ₹6,023 on Multi Commodity Exchange (MCX) during the initial hour of trading on Monday against the previous close of ₹6,042, down by 0.31 per cent, and January futures were trading at ₹6,003 against the previous close of ₹6,023, down by 0.32 per cent.
Market players are expecting the US Federal Reserve to reduce interest rate by 25 basis points in this week’s meeting. They expect the rate cut to help in boosting economic growth in the US. This, in turn, is likely to increase demand for commodities such as crude oil.
Market is also waiting for Fed’s economic projections for the next year. The projections will provide an outlook on further interest rate cuts in 2025.
Meanwhile, the latest data by the National Bureau of Statistics of China limited the decline in the prices of crude oil on Monday.
According to the National Bureau of Statistics of China, industrial production in that country increased by 5.4 per cent year-on-year in November 2024, exceeding the growth rate of 5.3 per cent in October. This growth was mainly due to the growth in manufacturing activities in November. This sector witnessed a growth of 6 per cent in November as against 5.4 per cent in October.
China is a major consumer of crude oil in the global market, and an improvement in the economic activities there will help boost the demand for the commodity in the world market.
December natural gas futures were trading at ₹273.70 on MCX during the initial hour of trading on Monday against the previous close of ₹279.20, down by 1.97 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), January jeera contracts were trading at ₹23,600 in the initial hour of trading on Monday against the previous close of ₹24,040, down by 1.83 per cent.
December dhaniya futures were trading at ₹7,652 on NCDEX in the initial hour of trading on Monday against the previous close of ₹7,724, down by 0.93 per cent.
