MCX moderates margins on crude oil futures, brokers cut positions sharply

Significant fall in number of contracts traded since Friday, brokers advise clients to stay away from what they see as a very volatile market

Crude oil traders are struggling to pay the shortfall in margins three days since the rout on Monday when prices crashed. While banks were closed yesterday, MCX was open for the evening session when some long positions in crude were cut due to margin shortfall, market sources said.

There was some relief yesterday, though, as a modest price recovery reduced additional margins requirements for players reeling under a cash crunch. And today, with the market settling down, MCX cut margins from 60 per cent to 45 per cent, indicating reduced stress levels.

Ajay Kedia, director at Mumbai-based Kedia Avisory said,