DBT Bureau
Pune, 21 Jan 2026
Crude oil prices climbed strongly yesterday, settling up 1.75% at ₹5,517, underpinned by firmer global economic growth expectations and a softer U.S. dollar that made dollar-priced crude more attractive for international buyers. The upturn was also supported by better-than-expected fourth-quarter Chinese GDP data and record crude import volumes into China, which reflect strong demand fundamentals from the world’s largest crude importer. Chinese crude imports rose sharply year-on-year in December and hit record highs for the full year, driven by increased refinery throughput and strategic stockpiling. Market tightness remained evident in certain regions, with supply disruptions in the Black Sea and a temporary production halt at Kazakhstan’s Tengiz field contributing to near-term risk premiums. Investors are now focused on the International Energy Agency’s upcoming monthly report for fresh insight into global oil supply and demand balances, which recently highlighted a narrowing surplus outlook as demand expectations were revised higher. On the fundamentals, the U.S. Energy Information Administration projects that after reaching a record high in 2025, U.S. crude production will ease in 2026 and 2027, while petroleum demand is expected to hold steady before rising slightly, reinforcing a balanced medium-term demand trend. Technically, the market is under fresh buying pressure, reflected by a 2% gain in open interest alongside a ₹95 price rise. Crude oil has immediate support at ₹5,411, with a break below that level potentially testing ₹5,305. On the upside, resistance is seen at ₹5,580, and a sustained move above could push prices toward ₹5,643.
Natural gas prices surged sharply yesterday, settling up 5.47% at ₹351, driven primarily by a weather-led rally as forecasts shifted toward much colder scenarios across the Northern Hemisphere. The expansion of the polar vortex has allowed Arctic air to spill deep into the central and eastern United States, significantly lifting heating demand expectations. NOAA’s Climate Prediction Center issued a high-priority alert for extreme Arctic cold and potential winter storms through month-end, with the harshest conditions expected in the final week of January. This outlook overshadowed near-term supply concerns, even as production remains elevated and LNG export flows are marginally lower. On the data front, U.S. utilities withdrew 71 bcf of natural gas from storage in the week ended January 9, well below market expectations and sharply lower than both last year’s draw and the five-year average, reflecting earlier mild weather. Total inventories now stand at 3.185 tcf, still above both last year’s level and the seasonal norm. Looking ahead, the EIA projects U.S. gas output to rise to fresh record highs in 2026 and 2027, while domestic consumption is expected to ease, partly offset by steady growth in LNG exports. Technically, the market is witnessing aggressive short covering, with open interest plunging 29.11% alongside a ₹18.2 price gain. Natural gas has support at ₹328.3, with a break lower opening room toward ₹305.7. On the upside, resistance is seen at ₹368.1, and a decisive move above could extend gains toward ₹385.3.
Source: Kedia Stocks & Commodities Research
(Disclaimer: This information is for educational purposes only. Please consult your financial advisor before taking positions in stocks)
