On Tuesday morning, September Brent oil futures were recorded at $84.62, marking a slight decline of 0.27 percent. Concurrently, September crude oil futures for WTI (West Texas Intermediate) stood at $80.59, down by 0.31 percent from the previous session.
Indian Commodity Exchange (MCX)
In the early trading hours on Tuesday, July crude oil futures on the Multi Commodity Exchange (MCX) were observed at ₹6,828, showing a decrease of 0.28 percent compared to the previous close of ₹6,847. Additionally, August futures were trading at ₹6,752, down by 0.27 percent from the previous close of ₹6,770.
China’s Economic Performance
China reported a GDP growth of 4.7 percent for the second quarter of 2024, falling short of market expectations which had anticipated a growth of 5.1 percent. This figure also marked a decrease from the 5.3 percent growth recorded in the previous quarter. The decline in China’s oil imports in June was attributed to weak demand, with refinery output decreasing by 3.7 percent. Factors such as planned refinery maintenance, lower processing margins, and reduced product demand contributed to this downturn. As the world’s second largest consumer of crude oil, China plays a pivotal role in global oil markets.
US Federal Reserve Statement
US Federal Reserve chair Jerome Powell’s recent remarks have sparked anticipation of a potential interest rate cut in the United States over the coming months. Powell highlighted progress in controlling inflation during the second quarter, stating, “In the second quarter, actually, we did make some more progress on taming inflation. We’ve had three better readings, and if you average them, that’s a pretty good place.” He emphasized that any decision to ease policy would hinge on achieving sustained inflation returning to the target of 2 percent.
Market Reaction
Market analysts noted that the possibility of lower interest rates in the US could stimulate global oil demand. This expectation has implications for commodity markets worldwide.
Natural Gas and Other Commodities
In the initial trading hour on Tuesday, July natural gas futures on MCX were trading at ₹180.30, reflecting a decline of 2.70 percent from the previous close of ₹185.30. Meanwhile, on the National Commodities and Derivatives Exchange (NCDEX), August turmeric (farmer polished) contracts were trading higher at ₹15,580, up by 0.58 percent from the previous close of ₹15,490. Conversely, July jeera futures on NCDEX were trading at ₹26,170, down by 0.83 percent from the previous close of ₹26,390.
This comprehensive update encapsulates the current dynamics in the oil and commodity markets, driven by economic indicators and policy developments both domestically and internationally.
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