Oil prices dipped on Monday as a slowdown in Chinese refining activity growth cast doubts over its crude demand outlook, while rising U.S. shale output suggested supplies would likely remain high.
Oil prices were little changed in early Asian trading on Friday after retreating in the previous session, weighed by ongoing global glut concerns despite a bigger-than-expected draw in U.S. crude inventories.
The government is hoping for lower subsidy bills over next two years as the global crude oil market struggles to rise despite the historic agreement between Opec and non-Opec producers to cut output. The government has budgeted Rs 25,000 crore toward petroleum subsidy in the current fiscal.
Mid-Term Expenditure Framework: Government Projects Petroleum Subsidy Falling To Rs 10,000 Crore In FY20
Modi government seems to be taking a lot of comfort from the low crude oil prices while banking on the domestic distribution reforms as it has projected a sequentially lower petroleum subsidy in the next two financial years.
Oil held around $52 a barrel on Wednesday as an industry report showing a large drop in U.S. crude stocks countered doubts that compliance with OPEC-led supply cuts will increase.
Oil markets opened weak on Friday, with US crude remaining below $50 per barrel, restrained by rising output from the United States as well as producer club Opec.
Oil dipped on Thursday as a rally that has pushed up prices by almost 10 percent since early last week lost momentum despite renewed signs of a gradually tightening U.S. market.
U.S. oil opened above $50 per barrel for the first time since late May on Monday, supported by strong fuel demand, but ongoing high supplies from producer club OPEC kept prices from rising further
As pessimism over oil dissipates and investors flirt with $50 a barrel again, short-sellers are getting out of the way.
WTI crude oil prices jumped to the highest level of $49.23 per barrel since June 6, 2017.