Informist, Friday, Jan 14, 2022

By Sayantan Sarkar

MUMBAI – Crude oil prices rose sharply in India and abroad as supply constraints, coupled with easing concerns about the Omicron variant boosted demand for the commodity. 

* The dollar's overall weakness against major currencies also supported global prices today. A weaker dollar makes commodities priced in the greenback less expensive for holders of other currencies. 

* "The price slide that was triggered by the emergence of the Omicron variant has been reversed completely," Commerzbank AG said in a report. "This is because Omicron’s impact on oil demand has been considerably milder so far than initially feared," the German bank added. 

* In addition, crude oil stocks in the US are currently at their lowest level in more than three years, according to the Energy Information Administration. 

* The Organization of the Petroleum Exporting Countries and allies have also not been able to produce at the levels agreed by the cartel members at their latest meetings. This was adding more pressure to the supply side and boosting prices. 

* At 1630 IST

 --January crude oil contract on the Multi Commodity Exchange of India was up 1.3% at 6,157 rupees per barrel.

 --February contract on the New York Mercantile Exchange was up 1.3% at $83.13 per bbl.

* Outlook for the evening session: 

 --MCX contract is seen at 5,890-6,240 rupees per bbl

 --NYMEX contract is seen at $81.65-$84.15 per bbl. 

End

US$1 = 74.15 rupees

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Arshad Hussain

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