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Informist, Friday, Dec. 27, 2024

MUMBAI - Analysts believe that the movement in global crude oil prices and the rupee will determine the direction of shares of Indian oil companies in the near term. For oil marketing companies, whose key raw material is crude oil that is mostly imported, a rise in crude oil prices and depreciation in the domestic currency could hit their financials. The rupee closed at a record low of 85.53 a dollar Friday, logging the biggest single-day fall in about seven months.

About 80% of India's crude oil demand is met through imports and of these, more than 35% comes from Russia. Crude oil prices stabilised after being volatile in the past few months as there was an ease in concerns related to global crude oil supply as the geopolitical tension between Russia and Ukraine as well as Iran and Israel eased. Russia and Iran are among major crude oil producers in the world and the geopolitical tensions in these countries had led to major volatility in global prices of this commodity. 

However, prices of crude oil are likely to be weak in 2025 on muted demand and a rise in production in the US and countries which are not part of the Organization of the Petroleum Exporting Countries and its allies. The cartel recently reduced its forecasts for crude oil demand growth in 2024 and 2025 for the fifth time, leading to easing of prices. At 1945 IST, the Brent Crude futures traded on the Intercontinental Exchange was up 1% at $73.98 per barrel. 

For the Nifty Oil & Gas index, the short-term support is around 10335 points and resistance is 10900-11000 levels, Vipin Kumar, senior technical and derivatives analyst at Globe Capital Market, said. The index closed 0.7% lower at 10683.05 points, falling after three sessions of rise. However, the index snapped a two-week fall and rose 0.7% this week. 

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Following are the resistance and support levels for the sector's key stocks for next week, as per calculations based on their prices on the National Stock Exchange:

End

Reported by Anjana Therese Antony
Edited by Deepshikha Bhardwaj

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