Last Updated : 04 December 2012 at 16:20 IST
The morning saw crude oil prices trading a bit low on the international markets. But on India's MCX, crude oil for December delivery was a tad up and was seen trading at Rs.4885, a gain of 0.14% as on 10.19 am IST. The commodity has remained range-bound since and as on 03.51 PM was seen trading at Rs.4884 a barrel, a gain of 0.12%.
Economic activity in the manufacturing sector in US contracted in November following two months of modest expansion, while the overall economy grew for the 42nd consecutive month, say the nation's supply executives in the latest Manufacturing ISM Report On Business.
The PMI registered 49.5 percent, a decrease of 2.2 percentage points from October's reading of 51.7 percent, indicating contraction in manufacturing for the fourth time in the last six months.
This had made the commodity to trade low in the international markets.
Also, the US fiscal cliff issue is plaguing the markets:
"If the U.S. enters a recession, the critical question is how the impact of a U.S. slowdown filters into the relatively oil-intensive emerging market economies that drive global oil demand growth," JP Morgan said in a note which was reported by the Wall Street Journal.
A 1% decline in US growth figures may translate into 0.7% decline in economic growth for the rest of the world. And if the catastrophe occurs and US does go off the cliff, oil demand growth would be curtailed by 580,000 barrels a day, JP Morgan added.
The fiscal cliff is deemed as a slew of spending cuts and taxes to the tune of $600 billion that would automatically kick in, if Democrats and Republicans fail to clinch a budget deal aimed at reducing deficits.
MCX crude oil technical aspects
Meanwhile, on India's MCX, crude oil for December delivery is looking bullish for this week as it made a double bottom support around 4790 and as long as the level acts as a firm support, prices would remain bullish, according to Ankush Kumar Jain, Manager-Research, Metals-Energy; Commodity Online.
“Traders are advised to take a long position on every dip for this week and I expect Rs.5000-5050 levels by the end of this week. Short term traders may take a long position around 4860 with stop loss of Rs 4780 for the target near Rs 5050.” he concluded.
WTI crude oil futures on ICE Exchange Europe for January delivery is seen trading at $89.11 a barrel,a gain of 0.01% as of 4.17 PM IST. Brent crude for January delivery was seen trading at $110.58 a barrel, a loss of 0.31% compared to previous close.
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