Crude oil futures rise amid strong demand.
Analysts noted that increased betting activity by market participants helped sustain higher crude oil prices in futures trading, reflecting stronger market sentiment and steady demand expectations overall.
**Crude Oil Futures Surge ₹200 as Firm Spot Demand and Global Rally Boost Sentiment**New Delhi: Crude oil prices surged sharply on Thursday, gaining ₹200 to reach ₹5,351 per barrel in futures trade, as traders and investors ramped up their positions amid firm spot market demand and a broader recovery in global crude benchmarks. The upbeat movement reflected renewed optimism in the energy market following weeks of volatility and uncertain cues from overseas exchanges.
On the Multi Commodity Exchange (MCX), crude oil futures for November delivery traded significantly higher—up ₹200, or 3.88%, at ₹5,351 per barrel across 17,430 lots. The jump signaled a notable shift in sentiment, with market participants showing confidence that oil prices might continue their upward trajectory, at least in the short term.
According to market observers, the rise was primarily driven by strong buying activity and a pick-up in physical or “spot” demand from domestic refiners and industrial consumers. The renewed demand in the spot market encouraged speculative buying in futures, with traders raising their exposure to take advantage of a possible short-term rally.
“The increase in bets by participants and a firm tone in the physical market have helped crude oil futures sustain at higher levels,” analysts noted. They added that investors were factoring in improving global cues and a possible tightening in supply as geopolitical tensions and production constraints persisted in key oil-producing regions.
Globally, benchmark crude prices also traded on a firmer note. In the New York Mercantile Exchange (NYMEX), West Texas Intermediate (WTI) crude for December delivery rose 3.30% to USD 60.42 per barrel, while Brent crude, the global benchmark, climbed 3.21% to USD 64.60 per barrel. The parallel rise in both major benchmarks lent additional support to Indian futures, reinforcing traders’ conviction in the upward trend.
**Why the Rally Happened**Several intertwined factors contributed to Thursday’s surge in oil prices. Analysts pointed to stronger demand expectations, a modest decline in global inventories, and improved risk appetite among investors. Reports of increased industrial activity in China and a slower-than-expected rise in U.S. crude stockpiles also added to the bullish momentum.
Moreover, the geopolitical landscape continues to influence energy markets. Ongoing tensions in the Middle East, combined with production discipline from OPEC+ countries, have prevented oil prices from slipping below critical support levels. The recent attacks on energy infrastructure in the region have heightened concerns about supply disruptions, prompting traders to build long positions in anticipation of further price strength.
Back home, Indian crude oil prices have mirrored these international movements. dollar** in recent sessions has made imports slightly costlier, adding a domestic element to the rise in prices. However, improved refining margins and consistent demand from the transport and manufacturing sectors have balanced the overall market sentiment.
**Investor and Market Response**Market participants said the current trend in crude oil futures suggests a renewed phase of accumulation. “Participants are clearly increasing their long positions, which indicates that they expect prices to remain firm in the coming sessions,” a Delhi-based commodities trader told PTI. He added that the ₹5,300 mark could now act as a short-term support level, while the ₹5,400–₹5,450 range might serve as the next resistance zone if global cues remain supportive.
For small traders and retail investors, the rise has been both an opportunity and a cautionary signal. While some see it as a chance to book quick profits, others are wary of the market’s inherent volatility. The recent fluctuations in crude oil prices—driven by alternating expectations of economic slowdown and supply tightening—have kept risk levels elevated.
**Broader Economic Context**Crude oil prices are among the most closely watched indicators for the Indian economy, which relies heavily on imported oil to meet over 80% of its energy needs. Any sustained rise in prices can have ripple effects across inflation, fiscal balances, and consumer spending. Economists believe that while the current increase is moderate, a prolonged rally could challenge the Reserve Bank of India’s inflation-management efforts, especially if the rupee weakens further.
Despite the uptick, experts caution that the outlook remains mixed. The world oil market continues to balance between slowing global economic growth and tightening supply conditions. If major economies such as the U.S. and China show stronger industrial demand and higher consumption, oil could gain further ground. Conversely, a global slowdown or unexpected increase in inventories might cap gains.
**What Lies Ahead**Looking ahead, traders will keep a close watch on upcoming U.S. inventory data, OPEC+ production decisions, and geopolitical developments. Any signs of further production cuts or disruptions could drive prices even higher, while easing tensions or stronger output could trigger short-term corrections.
“The next few sessions will be crucial,” said an energy market analyst. “If crude sustains above the ₹5,300 level with consistent global support, we could see a push toward ₹5,450 or even ₹5,500 in the near term. However, traders should stay cautious as profit-booking could emerge at higher levels.”
For now, the day clearly belonged to the bulls. Firm global cues, robust domestic demand, and renewed buying interest combined to lift crude oil futures sharply higher, bringing some optimism back to India’s commodities market after several subdued weeks.