Crude oil futures steady at Rs 3,022 per barrel, WTI trades above $40

Crude oil futures were trading flat at Rs 3,022 per barrel on July 2 as participants increased their long positions. Prices rose following a sharp fall in US crude inventory, but was weighed down by rising coronavirus cases in the US as some states tightened restrictions on businesses.

The US Energy Information Agency reported that US crude inventories declined by 7.2 million barrels for the week-ended June 26.

"Although the general bias may be on the upside, as sharp drop in US crude stocks may continue to support, persisting worries about rising virus cases worldwide might cap gains on demand recovery fears,” said Ravindra Rao, VP- Head Commodity Research at Kotak Securities.

In the futures market, crude oil for July delivery touched an intraday high of Rs 3,051 and an intraday low of Rs 2,983 per barrel on MCX. So far in the current series, black gold has touched a low of Rs 1,655 and a high of Rs 3,153.

Crude oil futures for July delivery eased Rs 1, or 0.03 percent, to Rs 3,002 per barrel at 15:19 hours IST on a business turnover of 3,936 lots.

The same for August delivery slipped by Rs 1, or 0.03 percent, to Rs 3,025 per barrel on a business volume of 126 lots.

The value of July and August contracts traded so far is Rs 1,163.54 crore and Rs 3.19 crore, respectively.

Tapan Patel, Senior Analyst (Commodities), HDFC Securities, expects oil prices to trade sideways to up for the day with support at $38 and resistance at $42. "MCX July Crude Oil futures has support at Rs 2,920, with resistance at Rs 3,080."

West Texas Intermediate crude gained 0.71 percent at $40.10 per barrel, while Brent crude, the London-based international benchmark, was up 0.70 percent to $42.33 per barrel.