Crude oil dropped as investors balance the supply and demand dynamics in market.

yesterday settled down by -0.53% at 6520 as investors balanced the supply and demand dynamics in the oil market. On the supply side, Iran’s oil minister said the country’s oil output will reach 3.4 million barrels per day by the end of September despite US sanctions. Additionally, US authorities are reportedly considering a proposal to ease sanctions on Venezuela’s oil sector. Meanwhile, official data showed that US crude inventories fell by 6.1 million barrels last week, much larger than forecasts for a 2.8 million barrel drop. 

Gasoline stockpiles climbed 1.5 million barrels last week, as against the forecast for an 888,000 barrel drop. S&P Global (NYSE:) released data showing a slowdown in the pace of growth in U.S. service sector activity in August as well as a contraction in manufacturing activity during the month. Eurozone business activity contracted further in August as the region’s downturn spread further from manufacturing to services, according to PMI survey data. The S&P Global composite index flash reading fell to 47.0 from 48.6 in July, hitting its lowest since November 2020. The U.K. manufacturing PMI fell from 45.3 to 41.5 in August, hitting a 39-month low, while the services PMI fell from 51.5 to 48.7, touching a 7-month low. 

Technically market is under long liquidation as the market has witnessed a drop in open interest by -9.35% to settle at 6234 while prices are down -35 rupees, now Crudeoil is getting support at 6444 and below same could see a test of 6369 levels, and resistance is now likely to be seen at 6575, a move above could see prices testing 6631.