Market Recap In its monthly report released yesterday, OPEC indicated that output rose by 280,000 barrels per day (bpd) to a two-year high of 29.85 million bpd in January from December mainly due to higher Iraqi output. Hence, higher output by OPEC coupled with dollar strength exerted pressure on oil prices on Thursday. Moreover, easing worries with regard to unrest in Egypt also pressurized prices yesterday. But, supply worries from North Sea protected sharp decline in prices. Additionally, favorable employment data from the US also acted as a supportive factor for oil prices. Nymex crude oil prices traded on a flat note in yesterday’s trading session and closed at $86.73/bbl. However, depreciation in the Indian currency led oil prices to trade slightly up around 0.2 percent and touched an intra-day high of `4025/bbl on the MCX on Thursday. Natural gas Natural Gas Inventories decline As per report released by the US Energy Department yesterday, natural gas stocks declined 209 billion cubic feet (bcf) for the week ending 4th February. Gas prices declined more than 2 percent on the Nymex on Thursday, to close at $3.984/mmBtu. Prices slipped mainly on the back strength in the US dollar and mixed sentiments in the global financial markets yesterday. On the MCX, natural gas prices were down by 0.4 percent to close at 183.8 on Thursday. Sharp declines were cushion due to depreciation in the Rupee on the domestic platform. Outlook Supply concerns from the North Sea coupled with unrest in Egypt are expected to support oil prices today. But dollar strength will cap sharp gains in prices.

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