LONDON, March 29: Global commodity prices rose this week amid fresh concerns worries over tight supplies of raw materials, particularly for crude oil and metals.
Oil and gold had slid the previous week after striking fresh historic highs.
OIL: Crude prices raced higher on heightened worries about tight supplies as the US government said the country’s stockpiles failed to rise last week and as saboteurs attacked a key export pipeline in Iraq.
New York oil closed up almost five dollars on Wednesday after the US Energy Information Administration said crude inventories were unchanged at 311.8 million barrels in the week ending March 21.
That contrasted sharply with expectations for a gain of 1.8 million barrels.
The data “reflects continued tightness in the crude oil market,” said Barclays Capital analyst Costanza Jacazio.
Crude futures bounced even higher on Thursday, reaching more than 107 dollars in New York on news of the Iraq pipeline attack.
Some profit-taking set in Friday, however, on the view that a slowdown in the US economy might dampen energy demand and on news that the damage to the Iraqi pipeline was not as serious as first thought, analysts said.
One of Iraq’s two main oil export pipelines near the southern city of Basra was blown up on Thursday amid escalating fighting.
Sucden analyst Michael Davies said oil prices also fell on Friday after negative economic comments from US central bank officials helped to remind the market that energy demand growth could falter in the world’s largest consumer.
New York crude hit a record intraday high of 111.80 dollars on March 17 while London Brent scored a historic peak of 108.02 dollars earlier this month on the back of the weak dollar and choppy world financial markets.
The weak US currency makes dollar-priced commodities, like gold and oil, cheaper for buyers using stronger currencies, and therefore encourages demand.
By Friday, New York’s main oil futures contract, light sweet crude for delivery in May, had jumped to 105.85 dollars per barrel from 101.22 dollars on Thursday of the previous week, when markets had shut early for Easter.
Brent North Sea crude for May climbed to 103.94 dollars from 100.08 dollars.
GOLD AND SILVER: Gold rose but was well off the record high of 1,032.70 dollars per ounce that was forged the previous week.
Gold’s failure to hold above 950 dollars suggests that in the short-term, the market is still a little top heavy and will remain vulnerable to bouts of profit taking ahead of the month/quarter-end, said James Moore.
However, the longer-term outlook remains bullish as investors still seek to offset inflationary pressures created by high fuel costs, ongoing credit liquidity issues, recessionary fears in the US and falling treasury yields.”On the London Bullion Market, gold firmed to 934.25 dollars per ounce at Friday’s late fixing, up from 925.75 dollars on Thursday of the previous week.
Silver rallied to 18.36 dollars per ounce from 17.53 dollars.
PLATINUM: Platinum prices moved higher on the back of ongoing production problems in key exporter South Africa.
Platinum remains well supported, said Barclays Capital analysts.
The lower projected (platinum) supply this year will further erode above-ground inventories which are already at historically low levels thus exerting further upward pressure upon prices.
Palladium increased to 444 dollars per ounce from 430 dollars.
BASE METALS: Base metals rebounded, finding solid support from stretched global supplies and the weak US currency, traders said.
Three-month aluminium rose to 2,996 dollars per ton from 2,920 dollars.
Three-month nickel jumped to 31,495 dollars per ton from 29,300 dollars.
Three-month lead climbed to 2,885 dollars per ton from 2,835 dollars.
Three-month zinc fell to 2,358 dollars per ton from 2,410 dollars.
Three-month tin increased to 20,650 dollars per ton from 20,575 dollars.
GRAINS AND SOYA: Prices were mixed as traders kept an eye on prevailing weather conditions in major producer the United States.
There is very wet weather over the central United States, said Wachovia Securities Bill Nelson.
On LIFFE, London’s futures exchange, the price per ton of wheat for November delivery fell to 150 pounds from 151 pounds.
SUGAR: Sugar prices were somewhat subdued.
By Friday on LIFFE, the price per ton of white sugar for May delivery firmed to 337.50 pounds from 325.50 pounds on Thursday of the previous week.
On NYBOT, the price of unrefined sugar for May delivery rose to 11.96 US cents per pound from 11.90 cents.
RUBBER: Rubber prices slid in muted trading. On Friday, the Malaysian Rubber Board’s benchmark SMR20 decreased to 264.25 US cents per kilogramme from 266.70 US cents last week.—AFP
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