WTI Crude oil continued to face heavy resistance around $55 per barrel levels on prospect of rising US shale production and uncertainty over OPEC output cut. Crude Oil production from seven major US shale plays is forecast to climb by 41,000 barrels a day to 4.748 million barrels a day in February from January, according to a monthly report from the Energy Information Administration (EIA). Oil output from the Permian Basin, which covers parts of western Texas and south-eastern New Mexico, is expected to see the largest climb among the big shale plays. It's expected to rise by 53,000 barrels a day. MCX Crude oil futures also followed the global cues and tested lows near Rs 3540/50 levels following a continued retreat from highs above Rs 3850 per barrel.
Large speculators and traders trimmed their net positions in the WTI crude oil futures markets last week for a second consecutive week, according to the latest Commitment of Traders (COT) data released by the Commodity Futures Trading Commission (CFTC). The non-commercial contracts of WTI crude futures, traded by large speculators and hedge funds, totaled a net position of 433,562 contracts in the data reported through January 10th.
This was a weekly decline of -6,512 contracts from the previous week which had a total of 440,074 net contracts. Speculative bullish positions had risen for five straight weeks through December 27th. Meanwhile, the commercial traders position, categorized by the CFTC as hedgers or traders engaged in buying and selling for business purposes, totaled a net position of -465,400 contracts last week. This is a weekly increase of 1,364 contracts from the total net of -466,764 contracts reported the previous week.
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