Crude oil futures traded higher on Friday morning as markets remained cautiously hopeful about peace efforts between the US and Iran ahead of the long holiday weekend in the US.

At 10.08 am on Friday, September Brent oil futures were at $72.29, up by 0.68 per cent, and August crude oil futures on WTI (West Texas Intermediate) were at $69.06, up by 0.54 per cent. July crude oil futures were trading at Rs 6600 on Multi Commodity Exchange (MCX) during the initial hour of trading on Friday against the previous close of Rs 6540, up by 0.92 per cent, and August futures were trading at Rs 6626 against the previous close of Rs 6565, up by 0.93 per cent.

Earlier this week, negotiators from the US and Iran held indirect talks in Doha. However, these indirect talks concluded without reaching an agreement.

In their Commodities Feed for Friday, Warren Patterson, Head of Commodities Strategy of ING Think, and Ewa Manthey, Commodities Strategist, said the oil market is on course for its fourth consecutive week of declines as flows through the Strait of Hormuz continue to normalise. The increase in oil flows is putting growing pressure on the front end of the ICE Brent forward curve. It’s increasingly moving into contango, a sign of an oversupplied prompt market. The return of this supply coincides with continued releases from strategic petroleum reserves. “Yet, with the flat price falling and the forward curve moving into contango, we could start to see more buying in the market,” they said.

A Reuters report said that Kuwait’s oil production rose sharply to 1.65 million barrels per day in June from 580,000 barrels per day in May, as it boosted exports following the US-Iran interim peace agreement.

It said that at least five super-tankers carrying a total of 10 million barrels of ?Saudi oil have exited the Strait of Hormuz.

Market reports said that the UAE has restored its oil exports to pre-war levels. The UAE has used both the Strait of Hormuz and an oil supply pipeline to improve its exports.

July aluminium futures were trading at Rs 331.65 on MCX during the initial hour of trading on Friday against the previous close of Rs 328.20, up by 1.05 per cent.

On the National Commodities and Derivatives Exchange (NCDEX), July Mumbai rainfall contracts were trading at Rs 2345 in the initial hour of trading on Friday against the previous close of Rs 2328, up by 0.73 per cent.

July cottonseed oilcake futures were trading at Rs 3650 on NCDEX in the initial hour of trading on Friday `against the previous close of Rs 3664, down by 0.38 per cent. 

Source: The Hindu Business Line 

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