Crudeoil on MCX settled down -0.41% at 3629 after data showed that U. S. crude supplies rose for the third week in a row last week. The U. S. Energy Information Administration said in its weekly report that crude oil inventories rose by 2.9 million barrels in the week ended January 20. Market analysts' expected a crude-stock gain of 2.8 million barrels, while the American Petroleum Institute late Tuesday reported a supply increase of 2.9 million barrels. Supplies at Cushing, Oklahoma, the key delivery point for Nymex crude, decreased by 284,000 barrels last week, the EIA said. Total U. S. crude oil inventories stood at 488.3 million barrels as of last week, which the EIA considered to be at the upper limit of the average range for this time of year. The report also showed that gasoline inventories increased by 6.8 million barrels, compared to expectations for a gain of 0.5 million barrels. For distillate inventories including diesel, the EIA reported a gain of 76,000 barrels. U. S. drilling activity has risen by more than 6% since mid-2016, taking it back to levels seen in late 2014, raising concerns that the ongoing rebound in U. S. shale production could derail efforts by other major producers to rebalance global oil supply and demand. OPEC and non-OPEC countries have made a strong start to lowering their oil output under the first such pact in more than a decade, energy ministers said over the weekend as producers look to reduce oversupply and support prices. Technically market is under fresh selling as market has witnessed gain in open interest by 1.92% to settled at 8110 rupees, now Crudeoil is getting support at 3596 and below same could see a test of 3562 level, And resistance is now likely to be seen at 3656, a move above could see prices testing 3682.

Trading Ideas

# Crudeoil trading range for the day is 3562-3682.

# Crude oil prices dropped after data showed that U. S. crude supplies rose for the third week in a row last week.

# OPEC and other producers have agreed to cut production by almost 1.8 million barrels per day (bpd) for the first half of 2017 to fight a supply overhang.

# U. S. oil production, however, has risen by around half a million bpd since mid-2016 to 8.96 million bpd, offsetting significant amounts of any OPEC-led supply cut.