Oil prices edge up on report of lower U.S. crude inventories.

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Oil prices rose in early Asian trading on Wednesday, supported by a drop in U.S. commercial crude inventories reported by the American Petroleum Institute (API).

U.S. crude inventories fell by 3 million barrels in the week to June 15 to 430.6 million barrels, according to the weekly API report published on Tuesday.

Brent crude futures, the international benchmark for oil prices, were at $75.30 per barrel at 0008 GMT, up 22 cents, or 0.3 percent, from their last close.

U.S. West Texas Intermediate (WTI) crude futureswere at $65.34 a barrel, up 27 cents, or 0.4 percent.

Looming large over markets, however, was a June 22 meeting in Vienna of the Organization of the Petroleum Exporting Countries (OPEC), together with some other producers including Russia, to discuss forward supply policy.

De-facto OPEC leader and top crude exporter Saudi Arabia as well as Russia, which is not a member of the cartel but the world's biggest oil producer, are pushing for looser supply controls, which were introduced in 2017 to prop up prices.

Other OPEC-members, including Iran, are against such a move, fearing a sharp slump in prices.

Graphic on U.S. vs international oil prices

"Saudi Arabia and Russia continued to push for a relaxation in production constraints, going against many other members wishes," ANZ bank said on Wednesday.

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"Iran rejected a potential compromise, saying it won't support even a small increase in oil production. This puts Saudi Arabia in a tough position, as unanimity is needed for any accord to be reached," it added.

Jack Allardyce, oil and gas research analyst at Cantor Fitzgerald Europe, said he had the "expectation that supply quotas will be increased, but probably more in line with the smaller range being quoted (300,000-600,000 barrels per day) given the lack of consensus amongst OPEC members."

Allardyce said "we could see this knocking $5 per barrel off Brent and perhaps squeezing the WTI discount a little."

Markets were also anxiously watching trade tensions between the United States and China, in which both sides have threatened to impose stiff duties on each other's export products, including U.S. crude oil.

A 25 percent tariff on U.S. crude oil imports, as threatened by China in retaliation for duties Washington has announced but not yet implemented against Chinese products, would make American crude uncompetitive in China versus other supplies.

This would almost certainly lead to a sharp drop-off in Chinese purchases of U.S. crude, which have boomed in the last two years to a business now worth around $1 billion per month.

Graphic on U.S. crude oil exports to China 

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MCX Morning News Update Like that Gold , Aluminium and Crude oil.

Gold Prices Rise As Dollar Pares Gains -   Gold prices were higher on Thursday, rising above the $1,300 level as the dollar lost the momentum from a decision by the U.S. Federal Reserve to raise interest rates. Gold prices are denominated in U.S. dollars, so the movement of the U.S. dollar index impacts the gold price. On Thursday, the U.S. dollar index that measures the greenback’s strength against a basket of six major currencies was down 0.03% to 93.53, giving up gains despite a promising outlook foumr the U.S. economy. The Fed hiked rates by 25 basis points to a range of 1.75% to 2% and hinted at two more rate hikes later in the year, instead of only one previously. This would mean four rate hikes this year. Gold investors continued to eye the rate hike decision for signs that the dollar go on an upswing. A firmer U.S. dollar makes dollar-denominated assets such as gold more expensive for foreign buyers, and vice versa.

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Operating rate at secondary lead smelters down 3.98 percentage points in May - The operating rate across China's secondary lead smelters stood at 59.9% in May, down 3.98 percentage points from April, but up 24.6 percentage points from last year, SMM surveyed.  Stricter environmental probes by the central government from May accounted for the month on month decline. Most unlicensed small smelters were ordered to shut, and some qualified, large smelters saw their output affected by environmental cuts, SMM learned.  China’s output of secondary lead registered 100,900 mt in May, down 6,700 mt from April and up 41,400 mt from last year, SMM data showed. Operating rates across secondary lead smelters in June is likely to remain flat from May as environmental inspections continue, SMM expects.

Aluminium inventory dips for six straight weeks on fewer deliveries - China's inventory of primary aluminium, including SHFE warrants, shrank 53,000 mt from last Thursday to stand at 1.92 million mt as of Thursday June 14, SMM data showed. Despite torrential downpours in Guangdong province during last weekend, overall inventory declined on the week due to fewer deliveries to warehouses in northwest China. The drop marked a sixth consecutive week of decline.

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Oil prices fall as U.S. crude production hits another record - Oil prices eased on Thursday, dragged down by rising output, although strong demand and a drop in U.S. fuel inventories provided the market with some support.Prices were pulled down by another rise in U.S. oil production , which hit a weekly record of 10.9 million barrels per day (bpd) last week, according to the Energy Information Administration (EIA) on Wednesday. U.S. crude output has risen by almost 30 percent in the last two years, and it is now close to top global producer Russia, which produced 11.1 million bpd overall in the first two weeks of June. But the rising output came amid strong demand, which traders said prevented crude prices from falling further. U.S. consumption of gasoline in the United States rose to an historic high of 9.88 million bpd last week, according to the EIA.

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Interest rate hike to hurt India`s growth prospects: Industry.

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The industry today said 25 basis points rate hike by the RBI will hurt India's growth prospects and exhorted the central bank to revert to the policy of benign interest rates, reported PTI. However, a section from India Inc said the decision of the Reserve Bank (RBI) was a clear hint to the industry to push for growth by taking investment decisions, while some believe the central bank's hawkish monetary policy stance is here to stay for a while.

The Reserve Bank for the first time in four-and-half-years raised key interest rate today by 25 basis points to 6.25 per cent on inflation concerns arising from surge in international oil prices. "Given that inflation is being led by supply side issues, CII believes that raising interest rate would hurt growth while proving unequal to the task of tackling inflation," CII Director General Chandrajit Banerjee said. He hoped that going forward, the RBI would reassess and revert to the policy of benign interest rates which would be growth supportive.

"Going forward, the hardening of interest rate scenario is here to stay at least in the short term, however much we may not like it," Assocham Secretary General D S Rawat said. "The input cost pressures as highlighted by the RBI policy review would only increase for the exporters with the hiking of the repo rate by 25 basis points," engineering exporters' body EEPC India Chairman Ravi Sehgal said. "The rate hike gives a clear hint to India Inc to push for growth, take investment decisions as it can now foresee growth rate to pick up," said George Alexander Muthoot, MD, Muthoot Finance Limited.

Realtors' body Naredco's national president Niranjan Hiranandani said the hike is justified on account of inflationary trends, global hardening of interest rates as also petroleum prices moving upwards. "It will not make a major difference to real estate. However, in the long run, we would prefer rates coming down," he said.

HDFC Bank said the Reserve Bank is likely to go for more rate hikes like the one today on risks from factors like the minimum support prices for farm produce and firm global commodity prices. In the second bi-monthly monetary policy for the current fiscal, the central bank revised upwards the retail inflation range to 4.8-4.9 per cent in the first half of 2018-19, and 4.7 per cent in the second half.

It includes the impact from HRA for central government employees, with risks tilted to the upside. With all the six members voting for a increase in policy rates, the Monetary Policy Committee raised "repo rate by 25 basis points and kept the stance neutral", RBI said in a statement here. Excluding the impact of HRA revisions, CPI-based inflation is projected at 4.6 per cent in first half of 2018-19, and 4.7 per cent in H2, RBI said. RBI retained the GDP growth for the financial year 2018-19 at 7.4 per cent.

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Zinc futures up on rising demand.

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Zinc futures were trading higher during the afternoon trade in the domestic market on Wednesday as speculators created fresh positions on pick-up in demand from consuming industries at the spot markets. Market analysts attributed the rise in zinc futures to fresh bets created by participants on the back of rising demand at the domestic spot market.

At the MCX, zinc futures for June 2018 contract was trading at Rs 215.70 per kg, up by 0.05 per cent, after opening at Rs 214.65, against a previous close of Rs 215.60. It touched the intra-day high of Rs 217

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Nickel futures up on increasing demand.

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Nickel futures were trading higher during the noon trade in the domestic market on Monday as participants widened their bets, driven by pick-up in demand in the spot market. Analysts attributed rise in nickel futures to building-up of positions by traders due to pick up in demand from alloy- makers in the spot market.

At the MCX, nickel futures for June 2018 contract is trading at Rs 1033.80 per kg, up by 0.34 per cent, after opening at Rs 1032.80, against a previous close of Rs 1030.30. It touched the intra-day high of Rs 1037.50

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