Commodities: Crude prices slide as glut spectre rises; gold lower again
By Andrew Schonberg
Date: Friday 10 Mar 2017
(ShareCast News) - Crude-oil futures are down this Friday afternoon as traders are again gripped by concerns about a global glut and production curbs on the black liquid following recent unexpected builds in US inventories.
At 15:36 GMT, Nymex-priced West Texas Intermediate crude was down 0.47% to $49.05 a barrel, and Intercontinental Exchange-traded Brent was down 0.59% to $51.88 a barrel.
The prices of both grades dived lower after two separate reports earlier this week revealed a hefty and greater than expected increase in US stores.
IG market analyst Joshua Mahony noted crude was lower yet again on Friday, despite the cut agreed by producers and respected across many of the major producers worldwide.
Oanda senior market analyst Craig Erlam opined that an extension of production curbs beyond the middle of 2017 seemed required to prevent oil prices slipping further.
"This is far from guaranteed with Saudi Arabia appearing to lose it patience and non-OPEC compliance not seeming to match that of OPEC members," added Erlam.
He commented that it appeared substantial long speculative positions on the black liquid had been pared over the last 48 hours, which might bring some pricing stability.
Meantime, on Comex, gold was down 0.07% to $1202.3 an ounce, with silver down 0.36% to $16.98 an ounce and copper up 0.12% to 258.3 cents a pound.
FXTM research analyst Lukman Otunuga noted that safe-haven gold had been sold off incessantly this week with prices crashing below $1200 as speculations heighten over the Federal Reserve raising US interest rates this month.
"Bears have exploited the dollar's stability to pressure the yellow metal further during trading on Friday," said Otunuga in a research note.
"With Gold's sensitivity to US interest rate hike expectations reaching shocking levels this quarter, more downside could be expected as expectations mount over the Fed raising US rates repeatedly in 2017."
Three-month industrial metals on the London Metals Exchange were all lower. Copper led, followed by zinc, tin and then aluminum.
Among agriculturals, Chicago Board of Trade-priced corn was down 0.34% to 365.75 cents a bushel, with wheat up 0.06% to 444.25 cents a bushel.
On ICE, cotton No.2 down 0.62% to 77.34 cents a pound, with cocoa was up 2.69% to $1949 a MT.
Fiona Dawson, the global president of Mars, has warned that the price of chocolate will go up if Britain does not secure a trade deal in the aftermath of its exit from the European Union.
(Additional reporting by Conor Coyle)
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