Oil prices - a game of inventories: Angel Commodities Broking

Views by Mr. Prathamesh Mallya (Chief Analyst- Non-Agri Commodities & Currencies, Angel Commodities Broking):

"Oil markets have been falling very recently after the off-take of the OPEC meeting which said that they will continue to cut the oil output through March 2018. However, the markets reacted to the situation in a contrasting manner with a fall of 5 percent on that day itself discounting the positive news.

This is like a Catch 22 situation for oil markets wherein any positive news is rather taken negatively and the entire sentiments of investors goes for a catch. One thing is for sure, that high global inventories and higher US production continues to be a spoilsport for oil prices. The start of the summer driving season is a last brink of hope for any reversal in oil prices.

All said, prices have fallen drastically in just a few trading sessions and today's fall or more than 4 percent talks the volume of in itself. The price is falling at present and it will continue to fall in the week ahead. WTI oil prices (CMP: $ 47.20 will further fall towards $45.5 mark while in the Indian markets (CMP: Rs.3049/bbl) Rs.2900 looks to be the further target on the MCX."

Source : Equity Bulls

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