Crudeoil settled down -1.18% at 6116 after a Libyan oilfield restarted and supply worries faded, prompting traders to reduce long positions. Libya has restarted the 340,000-barrel-per-day (bpd) El Sharara field after protesters ended a four-month strike, which could double the country's current crude output. The government has also taken back control of the Ras Lanuf and Es Sider oil ports, ending an almost year-long occupation that reduced Libya's output to less than a quarter of the 1.4 million bpd it was pumping before protests began last summer. The U.S. Energy Information Administration said in its weekly report that U.S. crude oil inventories declined by 2.4 million barrels in the week ended July 4, compared to expectations for a decline of 2.2 million barrels. Total U.S. crude oil inventories stood at 382.6 million barrels as of last week. The report also showed that total motor gasoline inventories increased by 0.6 million barrels, compared to forecasts for a drop of 0.3 million barrels, while distillate stockpiles rose by 0.2 million barrels, below expectations for an increase of 1.2 million barrels. According to report, Libya’s largest oil field, Sharara is resuming production and could reach two-thirds of its 340,0000 barrel-a-day capacity by the end of Wednesday. Ongoing indications that Iraqi oil exports from the southern part of the country remained insulated from the sectarian violence that has swept the north in recent weeks also weighed. Technically market is under fresh selling as market has witnessed gain in open interest by 4.36% to settled at 10363 while prices down -73 rupee, now Crudeoil is getting support at 6078 and below same could see a test of 6041 level, And resistance is now likely to be seen at 6182, a move above could see prices testing 6249.

Trading Ideas:

Crudeoil trading range for the day is 6041-6249.

Crude oil prices dropped after a Libyan oilfield restarted and supply worries faded, prompting traders to reduce long positions.

The U.S. Energy Information Administration said in its weekly report that U.S. crude oil inventories declined by 2.4 million barrels.

Libya has restarted the 340,000-barrel-per-day (bpd) El Sharara field after protesters ended a four-month strike, which could double the output.