Crudeoil settled up 1.06% at 6094 in the line of expectation on upbeat U.S. inventory report as well as concerns that the Ukraine crisis could threaten oil shipments out of Russia. The U.S. EIA said in its weekly report that U.S. crude oil inventories increased by 947kbls in the week ending May 9, defying expectations for a decline of 100kbls. Total U.S. crude oil inventories stood at 398.5mbls as of last week. Still, markets applauded the report due to data revealing a 592kbls draw at the key storage hub in Cushing, Oklahoma, a sign bottlenecks may be loosening. The report also showed that total motor gasoline inventories decreased by 772kbls, compared to forecasts for a gain of 143kbls, while distillate stockpiles decreased by 1.1mbls, compared to expectations for a gain of 0.6mbls. Upbeat wholesale pricing data supported the growth-sensitive commodity as well. The Commerce Department reported earlier that producer prices increased by 0.6% last month, beating forecasts for a 0.2% gain, after rising 0.5% in March. YoY, the PPI rose 2.1% in April, beating expectations for a 1.7% increase and up from 1.4% in the preceding month. The CPI advanced 0.5% last month, compared to expectations for a 0.2% increase, after rising 0.6% in March. Markets continued to monitor events in Ukraine, as conflict between pro-Russian separatists and Ukrainian forces continued to escalate, stoking fears that the crisis will develop and drag the U.S. deeper into the standoff and possibly crimp Russian exports. Technically market is under fresh buying as market has witnessed gain in open interest by 18.4% to settled at 7843, now Crudeoil is getting support at 6053 and below same could see a test of 6011 level, And resistance is now likely to be seen at 6123, a move above could see prices testing 6151.

Trading Ideas:

Crudeoil trading range for the day is 6011-6151.

Crude oil gained supported by the deteriorating situation in Ukraine and the potential for other supply disruptions.

In a report, Energy Information Administration said that U.S. Crude Oil Inventories rose to a seasonally adjusted annual rate of 0.947M, from -1.781M in the preceding month.

OPEC raised the forecast demand for its crude oil in 2014 to 29.76 million bpd, up 110,000 bpd from the previous estimate.