Crude oil futures Tanked over 4 % in the Domestic Market

Crude oil futures tanked over 4 per cent in the domestic market on Monday, registering their biggest single-day drop since September 1 in the overseas market as investors and speculators pressed the sell-off button in the energy commodity after a report showed that the OPEC, the cartel that controls around 40 per cent of global crude oil supplies, continued to pump output at swift rates despite falling prices, signaling no end to the ongoing supply glut.

OPEC’s production climbed by 109,000 barrels per day to 31.57 million barrels per day in September, signaling the reluctance on part of member nations to curb output as they bid to protect market share. However, some relief was offered in the form of a forecast for a maiden drop in US crude output in eight years in 2016.

OPEC predicted lower non-OPEC supply growth of 720,000 barrels per day in 2015, down by 600,000 barrels per day from its earlier forecast and below last year’s levels.

Oil may extend losses today after China’s imports plunged for the eleventh month on the trot, dropping 17.7 per cent, year on year in yuan terms in September, marking the longest losing streak in six years, while exports fell 1.1 per cent, signaling more pain for the world’s second biggest economy, darkening the demand outlook for the fuel.

At the MCX, Crude oil futures, for the October 2015 contract, closed at Rs 3,075 per barrel, down by 4.06 per cent, after opening at Rs 3,205, against the previous close price of Rs 3,205. It touched an intraday low of Rs 3,067.

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