Crude oil prices up on predicted cold weather

With temperatures forecast to drop over the a large section of United States and much of Europe, crude oil prices were higher on Monday. Temperatures in the northeast US are expected to remain below normal for the next week to week and a half, while European temperatures are forecast to drop within the next few days. Mild weather so far this winter have sent prices down by 13 percent since the beginning of the year. Data from the Commodities Futures Tradning Commission in the US has shown, however, that lower prices did not mean fewer participants in the market. However the number of short positions on West Texas Intermediate crude, betting that prices will fall, has dropped from 20,000 contracts week before last to just 2,000 last week.

Brent crude for March delivery added 46 cents to $53.90 per barrel late in the afternoon in London. February contracts for WTI on the New York Mercantile Exchange, scheduled to expire at the close of trade Monday, gained $1.10 to $53.09 per barrel early in the day. March WTI contracts were up 55 cents to $53.97 per barrel.

In metal markets on Monday, gold added $1 by late in the day in London to trade at $636.75/$637.75 per troy ounce after hitting a three-year high at $639.60 per troy ounce earlier. Three-month nickel was up 3 percent on the day, more than $1,200 higher per tonne after rising to another record high at $37,300 earlier in the session. Inventories of nickel in London Metal Exchange warehouses has fallen to around 4,000 tonnes, just one day’s worth of global demand. In addition, there were worries about the nickel on a ship grounded off the southwest coast of England.

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