Crude oil futures fell about 4% on Thursday, as a bigger-than-expected Bank of England rate hike reignited worries of global economic slowdown and its impact on fuel demand about the economy and outweighed support from a surprise draw in U.S. oil supplies. The Bank of England raised interest rates by a bigger-than-expected half a percentage point to fight stubborn inflation.
Higher interest rates could slow economic growth and reduce oil demand. Both benchmarks remained under pressure even after a surprise dip in the U.S. crude inventories.
We expect crude oil prices to remain volatile in today’s session. Crude oil has support at USD 68.70–68.00 and resistance at USD 70.00–70.60 in today’s session. In INR terms, crude oil has support at Rs 5,610-5,540, while resistance is at Rs 5,770–5,840.
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