Finance Markets

June 14, 2006

US crude oil inventories drop

Filed under: Commodities, Oil, Metals, Economy

New figures released by the Energy Information Administration in the United States show that crude oil stockpiles were down by 900,000 barrels in the week ending June 9, a larger decline than had been expected and a sign that imports were lower and that refineries were processing more crude into petroleum products. Despite the decline, inventories are still well above average and do not signal a shortage.

Gasoline stockpiles were up for the seventh week in a row, adding a more than expected 2.8 million barrels to gasoline in storage during the week. The EIA also reported that distillate demand - heating oil, primarily - was unchanged in the past month, while demand for gasoline was up 0.6 percent and jet fuel demand was up 4 percent over last year’s levels.

By late afternoon, Brent crude for July had dropped 54 cents by late afternoon, to $66.38 per barrel on the International Petroleum Exchange in London. With the July contract expiring at the end of the day Thursday, August contracts attracted more sales, and were down 25 cents to $68.04 per barrel. Meanwhile, West Texas Intermediate crude for July delivery dropped just one cent in late morning trade on the New York Mercantile Exchange, to $68.55 per barrel.

In the metals markets, prices trended higher in both precious and base metals. Gold added around $2 to trade at $564.60/$565.30 per troy ounce by late afternoon in London. Silver was up by 20 cents to $9.76/$9.86 per troy ounce, and platinum gained $26 to $1,142 per troy ounce on reports that output would not meet forecasts.

Copper was up $2 to $6,570 per tonne after having lost 9 percent of its value in the past two sessions. Aluminium gained $38 to $2,495 per tonne, while zinc held steady at $2,960 per tonne.

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June 9, 2006

Gold prices lose 3.6 percent on week

Filed under: Commodities, Oil, Metals, Economy

Metals prices were down during the week as investors worried about what effect rising interest rates would have on demand for various commodities. Interest rates were raised in such diverse regions as the Eurozone, India, South Africa, Thailand, and Korea.

Among precious metals, gold dropped 3.6 percent over the week to $615.15 per troy ounce. Silver also declined, by 6 percent on the week to $11.38 per troy ounce, even though the government of Bolivia told miner Coeur D’Alene that it wouldn’t nationalize the company’s mine there, which is expected to produce 8 million ounces of silver every year, beginning in 2007. In addition, platinum lost 3.3 percent to $1,199 per troy ounce during the week, while palladium dropped 8 percent to $323 per troy ounce.

Base metals were down as well. Copper dropped 10.1 percent to $7,075 per tonne even though investors worried about short supply and increased demand. Nickel dropped 6.5 percent over the week to $20,000 per tonne, while lead fell by 1.9 percent to $1,010 per tonne on London Metal Exchange inventories that were at their most plentiful since December 2003. Aluminium was down 5.5 percent to $2,500 per tonne. Zinc, meanwhile, declined by 7.5 percent to $3,320 per tonne even after a prediction that supply shortages could last for at least the next ten years.

Crude oil prices rebounded after their fall on Thursday after the death of a key al-Qaeda leader was reported in Iraq. Concerns that attacks on Iraq’s infrastructure would continue, as well as weather worries, sent July contract Brent crude up $1.33 to $70.38 per barrel on the International Petroleum Exchange. West Texas Intermediate crude for July delivery added $1.20 to $71.55 per barrel on the New York Mercantile Exchange.

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June 8, 2006

Zarqawi death sends oil prices lower

Filed under: Commodities, Oil, Metals, Economy

The death of an al-Qaeda leader in Iraq led to a substantial decline in crude oil prices on Thursday. Abu Musab al-Zarqawi, who has led attacks on the oil infrastructure in Iraq since the downfall of the regime of Saddam Hussein that have seen oil production there drop to about 1.8 million barrels of oil per day, was killed in an air attack outside Baghdad. Most analysts assume that now that al Zarqawi is out of the picture, oil production will be able to increase in Iraq as attacks against facilities dwindle.

Brent crude July contracts dropped $1.16 to $69.35 per barrel late in the day on the International Petroleum Exchange in London, taking the week’s losses to 4 percent so far. Meanwhile, in late morning trade on the New York Mercantile Exchange, West Texas Intermediate crude had lost $1.42 to $69.35 per barrel, its lowest price in two weeks. WTI had already dropped $1.68 on Wednesday after the release of inventory data that showed increases in stockpiles of both crude oil and gasoline.

In other commodities, gold lost 3 percent after the European Central bank raised interest rates by 25 basis points, strengthening the dollar in relation to the euro. Gold was trading at $611.30 per troy ounce, $19 dollars from Wednesday’s late quote in New York. Silver was down as well, off 50 cents to $11.25 per troy ounce.

Prices for base metals were down, as well. Copper was down 5.5 percent to $7,355 per tonne on the London Metal Exchange, a drop of $450 dollars. Aluminium was down $140 to $2,510 per tonne, while lead dropped below $1,000 per tonne for the first time this year.

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June 7, 2006

Inventories up, crude oil lower

Filed under: Commodities, Oil, Metals, Economy

New inventories data that showed both crude oil and gasoline stockpiles up in the US in the week ending June 2 sent crude oil prices down on Wednesday as investors’ supply concerns eased somewhat. Crude oil inventories were up by 1.1 million barrels to a total of 346.6 million barrels as more crude oil was imported into the US and refineries did not process as much crude into petroleum products. Even though production was down, gasoline stockpiles added 1 million barrels on the week to a total of 210.3 million barrels on hand.

July contracts for Brent crude dropped by $1.26 to $69.55 per barrel on the International Petroleum Exchange in late afternoon trade in London. Meanwhile, West Texas Intermediate crude for July delivery had lost $1.45 to $71.05 in early afternoon trade on the New York Mercantile Exchange. In addition, Nymex July unleaded gasoline was down 4.38 cents to $2.1350 per gallon, while July heating oil was down 5.26 cents to $1.9900 per gallon.

Metals prices were mixed. Precious metals were down, with gold losing about $6 by late in the day in London to trade at $624.50/$625.50 per troy ounce after having dropped as low as $616.40 per troy ounce earlier in the day.

Base metals, however, saw gains on the day. Copper was up late in the day, rising more than $600 from its low of the day to trade at $7,855 on the London Metal Exchange. Most of the gain had to do with continuing concerns over short supply. Among other base metals, aluminium was up $57 dollars from Tuesday’s close and $100 higher than its low point in the day to $2,610 per tonne. Zinc was up $280 to $3,640 per tonne, while nickel was trading at $21,325 per tonne late in the day in London.

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June 6, 2006

Oil, gold prices decline

Filed under: Commodities, Oil, Metals, Economy

Oil, gold prices decline

Crude oil prices were lower on Tuesday after Iran reacted in a largely positive manner to an incentives package presented by several western nations in an effort to resolve the conflict over Iran’s controversial nuclear program. While there are still some “ambiguities” in the package from the point of view of the secretary of Iran’s Supreme National Security council, he also said that it contained “positive steps”.

Meanwhile, the Energy Information Administration said that it expects the price for West Texas Intermediate crude to average $68 per barrel for the rest of this year and all of next year. The statistical arm of the US energy department also projected that consumption growth was slower due to high prices but that it would be at 1.7 million barrels per day through the rest of 2006 and at 1.9 million barrels per day in 2007. This increase in consumption, the EIA said, would be met by production increases from non-OPEC nations.

By late afternoon in London, July contract Brent crude on the International Petroleum Exchange had dropped $1.40 to $69.97 per barrel, while in early afternoon trade on the New York Mercantile Exchange, West Texas Intermediate crude for July delivery was $1.15 lower at $71.45 per barrel.

Metals prices were also down. A strengthening US dollar took gold prices down over 2 percent to $627.95/$628.95 per troy ounce. Gold has lost over $100 from the 25-year high it achieved last month.

In base metals, meanwhile, copper also lost over 2 percent to $7,550 per tonne. It has lost in excess of 16 percent in the past month. Worries over copper supplies continue, however, as Freeport-McMoRan Copper & Gold Inc has said that output at its Indonesian mine would be 16 percent lower than earlier estimates and Grupo Mexico has announced that it would not be able to meet its June and July contract obligations.

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June 2, 2006

Weather, unrest lead to higher oil prices

Filed under: Commodities, Oil, Metals, Economy

Continuing unrest in Nigeria and weather problems sent the price of crude oil substantially higher on Friday. In Nigeria, militants kidnapped eight oil workers from an offshore platform. Meanwhile, in a separate development in the African nation, Shell cut production by another 50,000 barrels per day due to a pipeline leak. That brought Shell’s total lost output in Nigeria to 505,000 barrels of oil per day. In Texas, bad weather on Friday interrupted production at refineries owned by Valero and Citgo Petroleum.

As a result, July contracts for Brent crude added $1.30 to $70.79 per barrel on the International Petroleum Exchange in London, while West Texas Intermediate crude was up $1.56 to $71.90 per barrel on the New York Mercantile Exchange. The Texas production disruptions added to undiminished demand for gasoline in the US sent Nymex July unleaded gasoline prices up 4.3 cents to $2.170 per gallon.

Elsewhere, during the meeting of the Organisation of Petroleum Exporting Countries, the cartel rejected member nation Venezuela’s call to cut output and the expected decision to leave production at existing levels was taken. The Saudi Arabian oil minister said, during the meetings, that market fundamentals do not support a price for crude oil of over $50 per barrel. The implication in his remarks was that geopolitical issues were adding $20 per barrel to the price of oil, twice as much as the estimate of most analysts.

In the metals markets, meanwhile, prices dropped during the week. Among base metals, copper lost 4.6 percent on the week to $7,850 per tonne, while nickel lost 6.5 percent to $21,500 per tonne, aluminium was 5.4 percent lower to $2,645 per tonne, and zinc declined by 4.9 percent. In precious metals, gold was down 2.8 percent on the week to $632.00 per troy ounce. Silver declined by 5.7 percent to $12.02 per troy ounce, platinum lost 4.3 percent to $1,230 per troy ounce, and palladium was down by 0.6 percent to $343 per troy ounce.

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June 1, 2006

Metals prices fall; crude oil up slightly

Filed under: Commodities, Oil, Metals, Economy

Metals prices were down on Thursday, but crude oil prices rebounded slightly after new reports showed that demand for gasoline in the US is still high despite high pump prices.

Demand for gasoline in the US was up 0.9 percent to 9.32 million barrels per day, while demand for all oil products gained 4.8 percent to 21.1 million barrels per day. Meanwhile, gasoline inventories were up 0.8 million barrels during the week ending May 26 according to the US Energy Information Administration, when analysts had expected stockpiles to add 1.1 million barrels. All this data combined to raise the price of July delivery gasoline on the New York Mercantile exchange by 0.5 cents to $2.1500 per gallon.

Crude oil inventories were up by 1.6 million barrels last week even though they had been predicted to be 0.9 million barrels lower. Still, July delivery Brent crude on the International Petroleum Exchange added 3 cents to $70.44 per barrel, while Nymex July contracts for West Texas Intermediate crude was up 14 cents to $70.44 per barrel.

In the metals markets, gold dropped 2 percent to $630.60 per troy ounce after going as low as $620.90 during the day. Silver was down 3.3 percent to $12.08 per troy ounce, while platinum declined by 1.7 percent to $1,227 per troy ounce.

Among base metals, three-month copper dropped 3.7 percent to $7,607 per tonne, but had been as much as 7.1 percent lower at $7,340 per tonne earlier in the day. Among the circumstances leading to the decline were the upcoming auction of as much as 100,000 tonnes of copper as well as the switch to longer trading hours for the London Metal Exchange, a change which was made in order to accommodate the Asian markets.

Elsewhere, aluminium dropped 1.9 percent to $2,600 per tonne and zinc was 4.4 percent lower at $3,510 per tonne. Nickel dropped 4.3 percent to $20,550 per tonne, but earlier in the day it had been 9.6 percent lower than Wednesday’s close and was trading at $19,800 per tonne.

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May 31, 2006

Most metals prices, oil decline

Filed under: Commodities, Oil, Metals, Economy

With the United States government announcing that it is willing to conduct talks with Iran if it will suspend its uranium enrichment program, and with the UN Security Council’s five permanent members scheduled to meet today to decide on incentives to offer Iran in return for that nation’s cooperation on nuclear issues, the price of crude oil dropped significantly during the day on Wednesday. The declines came ahead of a meeting of the Organisation of Petroleum Exporting Countries, during which the cartel is expected to hold production quotas at current levels.

July contract Brent crude oil on the International Petroleum Exchange declined by $1.73 to $69.32 per barrel in London, while West Texas Intermediate crude for July delivery lost $1.72 to $70.31 per barrel. The declines came even though Iran continued to say that it is determined to continue with its nuclear program, which is said includes the intention to build two nuclear reactors.

Base metals were mixed, with aluminium and copper prices dropping, but the price of nickel advancing. Prices for precious metals were down.

Gold lost 1.9 percent to $639.70 per troy ounce as tensions over the Iran situation subsided somewhat and as investors waited for release of the minutes of the most recent meeting of the US Federal Reserve, scheduled for later in the day. Meanwhile, silver was down 3.9 percent to $12.48 per troy ounce, while platinum declined by 2.9 percent to $1,246 per troy ounce and palladium dropped 2 percent to $348 per troy ounce.

Copper was down 1.1 percent to $7,860 per tonne as London Metal Exchange inventories grew by 6,150 tonnes and China got ready for an auction of copper next week. Aluminum was down 1.7 percent to $2,650 per tonne as investors waited to hear whether a possible strike against Alcoa would materialize when a labour contract expires at midnight. Most analysts, however, believed that the chances of a strike are slim. Nickel was up 1.4 percent after a significant loss on Tuesday.

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May 30, 2006

Oil prices rise on demand growth in China

Filed under: Commodities, Oil, Metals, Economy

Prices for crude oil and precious metals were up on Tuesday, while base metals prices saw declines despite lower inventories in some commodities.

New data showed that oil demand in China grew at its quickest rate in two years in April as estimated consumption was up 10.8 percent year-on-year following an increase in fuel prices that had been meant to encourage Chinese refiners to send more of their supplies to the domestic market. Other news affecting oil prices included the decision by the Organization of Oil Exporting Countries during a meeting in Venezuela to hold production by its members to its current level of 28 million barrels per day and a US push to convince Europe and Japan to institute financial sanctions against Iran to convince that nation to halt its uranium enrichment program.

The price for Brent crude July contracts was up 84 cents to $71.43 per barrel on the International Petroleum Exchange. Meanwhile, July delivery West Texas Intermediate crude was up 98 cents to $72.35 per barrel on the New York Mercantile Exchange.

Gold prices were aided by continuing weakness in the US dollar, adding 1.2 percent to $657.70 per troy ounce. Silver was up 3.2 percent to $13.16 per troy ounce, while platinum was slightly to $1,296 per troy ounce. Palladium was also up slightly to $355 per troy ounce.

Copper dropped 2.8 percent to $8,000 per tonne as rumors spread that China will auction 20,000 to perhaps as much as 100,000 tonnes of copper later in the week in Shangai in its first copper sale of the year by the Asian nation’s State Reserve Bureau.

Nickel dropped 6.1 percent to $21,600 per tonne after Inco reached a provisional agreement with the United Steelworkers on Monday, averting a threatened strike at its Sudbury facility. Strike worries had sent nickel prices up to $23,000 on Friday.

Zinc prices fell 1.5 percent to $2,715 per tonne even though London Metal Exchange zinc inventories were down by 1,350 tonnes.

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May 26, 2006

Gold lower, base metals gain on week

Filed under: Commodities, Metals, Economy

In the metals markets on Friday, base metals saw prices rise while gold fell during the week.

Copper was up $150 late Friday to $8,252 per tonne, a 7 percent gain during the week. Still, copper remained 6 percent lower than its record high of $8,790 per tonne, set earlier in the month. In attempts to curb the volatility of recent trade, the Shanghai Futures Exchange has raised the margins necessary to trade copper futures, and the New York Mercantile Exchange is expected to follow suit.

Nickel was up $875 on Friday to a new record of $23,000 per tonne, and it gained 17 percent on the week. The recent increases in nickel prices are reportedly being driven by strike rumors and by inventories that have fallen by 48 percent this year in London Metal Exchange warehouses.

Zinc added $215 on Friday to $3,825 per tonne, a gain of 18 percent this week and only 4 percent below its record high level, again on supply worries.

Aluminium prices rose $25 on Friday to $2,800 per tonne, a 2 percent rise during the week.

Gold, on the other hand, declined by over 1 percent during the week to trade at $651.80/$652.60 per troy ounce late in the day in London on Friday.

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May 25, 2006

Commodities prices up again

Filed under: Commodities, Oil, Metals, Economy

Commodities prices were up on Thursday ahead of long weekends in both the US and the UK.

Copper spent some time during the day back above the $8,000 level and were up $125 to $7,955 per tonne in late afternoon trade on the London Metal Exchange. Trade volumes were light. In other base metals, nickel added $100 to $22,100 per tonne, while aluminium gained $30 to $2,770 per tonne. Zinc was up $55 to $3,520 per tonne.

Gold was $10 higher than its late quote in New York on Wednesday to trade at $649.30/$649.80.

Crude oil prices were up as well. Brent crude July contracts were up 54 cents to $69.76 per barrel by late afternoon in London on the International Petroleum Exchange. July delivery West Texas Intermediate crude on the New York Mercantile Exchange gained 64 cents to $70.50 per barrel in early afternoon trade.

The upcoming Memorial Day holiday, which marks the beginning of the summer driving season in the United States, saw gasoline prices rise as usual. June delivery Nymex unleaded gasoline was up 3.05 cents to $2.0495 per gallon.

Meanwhile, the Organisation of Petroleum Exporting Countries said it has invited Sudan into full membership in the oil cartel. Sudan would be the smallest producing member, at 500,000 barrels per day.

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May 24, 2006

Oil, metals prices decline

Filed under: Commodities, Oil, Metals, Economy

Prices for crude oil and metals dropped on Wednesday after having advanced substantially on Tuesday.

The US Energy Information Administration reported that crude oil inventories were down by 3 million barrels in the week ending May 19. The decline was much higher than the 800,000 barrel drop that had been expected. However, stockpiles of crude remain plentiful and inventories of gasoline were up by 2.1 million barrels during the week, greater than the 1.4 million barrel increase that analysts had predicted.

July contracts for Brent crude on the International Petroleum Exchange were down 32 cents after the EIA report to $70.68 per barrel, while West Texas Intermediate for July delivery lost 36 cents to $71.40 per barrel on the New York Mercantile Exchange. Meanwhile, Nymex unleaded gasoline June contracts lost a bit over 2 cents to $2.0875 per gallon.

Demand for gasoline was only up 0.3 percent over the same time last year, and the current high pump prices for gasoline seem to be cutting demand slightly. Still, there are concerns that refineries will be able to keep up with demand during the summer driving season, as refinery utilization was down by 0.1 percent to 89.7 percent. To compensate for the decline in refining, the US imported gasoline at the second highest weekly rate in history.

Among metals, copper was down by 7.5 percent to $8,217 per tonne after a record one-day price gain on Tuesday. The drop in price came even though Codelco warned that its production would drop by 6.5 percent during the year as it cut its long-term annual production target to 2.5 million tonnes by 2020, down from its previous target of 3 million tonnes by 2015. One prediction said demand could be hurt by slower growth in construction, possibly causing copper prices to drop by 20 percent.

In other base metals, zinc dropped 2.2 percent to $3,470 per tonne even though London Metal Exchange inventories dropped by 950 tonnes. Aluminium was down 4.5 percent to $2,740 per tonne despite strike worries. Nickel was slightly lower at $21,950 per tonne after having hit a new record high price of $22,320 per tonne earlier in the day.

Precious metals were lower as well. Gold dropped 4.3 percent to $642.50 per troy ounce. Silver declined by 2.4 percent to $12.62 per troy ounce, platinum dropped 2.7 percent to $1,280 per troy ounce, and palladium lost 3.9 percent to $345 per troy ounce.

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May 23, 2006

Commodities prices rebound

Filed under: Commodities, Oil, Metals, Economy

Commodities prices were up on Tuesday, with crude oil and some metals notching substantial gains.

Copper added 12.7 percent to $8,525 per tonne. The trade in copper on the New York Mercantile Exchange was halted twice during the day when the increase in the price of copper hit its daily limit.

The price of nickel was up 6.2 percent to $22,200 per tonne, a new record. The increase came on a decline of 972 tonnes in inventories in London Metal Exchange warehouses. Meanwhile, zinc gained 5.7 percent to $3,520 per tonne on a report from the International Lead & Zinc Study Group, which said that while worldwide demand was up by 5 percent in the first quarter of the year output was flat, leading to a 103,000 tonne deficit in the metal.

In precious metals, gold was up 3 percent to $669 per troy ounce, while silver added 4.9 percent to $13.06 per troy ounce, platinum was up to $1,313 per troy ounce, and palladium rose to $356 per troy ounce.

The price of crude oil was up after the US National Oceanic and Atmospheric Administration said that another active hurricane season is expected this year and the Organization for Economic Co-operation and Development said that high oil prices are expected to last for a substantial period of time. July contract Brent crude on the International Petroleum Exchange added $1.35 to $70,70 per barrel, while West Texas Intermediate on the New York Mercantile Exchange was up $1.49 to $71.45 per barrel.

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May 22, 2006

Crude oil prices decline; metals mixed

Filed under: Commodities, Oil, Metals, Economy

Metals prices were mixed on Monday with gold lower, most other precious metals essentially unchanged, and base metals somewhat higher on the day. Crude oil prices were down slightly.

Brent crude July contracts on the International Petroleum Exchange were down 37 cents to $68.31 per barrel after dropping as low as $67.63 during the day. Meanwhile, West Texas Intermediate crude on the New York Mercantile Exchange declined by 8 cents to $68.45 per barrel. Analysts were of the opinion that if prices drop below $68.20, it could mean that a further decline to just above $65 per barrel could be coming.

Spot gold prices in London were affected after the precious metal dropped by its full 60 yen daily limit in Tokyo. By the close in London, gold had lost 1 percent to $650.50 per troy ounce.

Silver was nearly flat at $12.30 per troy ounce after recovering from a drop to $11.90 earlier. Platinum and palladium were also both close to their previous closing level. Platinum closed at $1,282 per troy ounce, while palladium ended at $336 per troy ounce.

Among base metals, copper ended the day up 1 percent to $7,625 per tonne after dropping as low as $7,250 during the day. Aluminium added 1.5 percent to $2,725 per tonne, while nickel was up 2 percent to $20,900 per tonne and zinc added 3.4 percent to $3,340 per tonne.

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May 19, 2006

Commodities prices lower on week

Filed under: Commodities, Oil, Metals, Economy

Commodities prices were down again on Friday. Some analysts blamed the lower prices on sell-offs by investors who were worried about where prices are headed after declines during the week.

Gold dropped 4 percent on the day and nearly 10 percent on the week to trade at $658.10/$658.40 per troy ounce in the late afternoon. Last Friday, gold reached a 26-year high at $730 per troy ounce. Elsewehre in precious metals, silver was trading at $12.11 per troy ounce during the day, almost 20 percent lower than late last week, when it hit a high of $15.17 per troy ounce.

Among base metals, copper lost 6 percent during the day to trade $500 dollars lower at $7,530 per tonne. It has lost 14 percent in the ten days since it hit a record high. Other base metals saw similar declines during the week.

Crude oil prices were down as well. Brent crude July contracts on the International Petroleum Exchange saw a decline of 95 cents to $68.72 per barrel late in the day after having seen gains earlier. It was down 5 per cent on the week, and it was the first time in five weeks that it has closed before $70 per barrel. Meanwhile, June contracts of West Texas Intermediate crude on the New York Mercantile Exchange had dropped 85 cents by early afternoon to $68.60 per barrel, around 9 percent lower than the record high it reached three weeks ago. The declines have come after increases in inventories in the United States.

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May 18, 2006

Oil slightly higher; metals decline

Filed under: Commodities, Oil, Metals, Economy

Crude oil prices were up slightly on Thursday as the big driving weekend of Memorial Day approaches at the end of the month. Prices at the pump are 75 cents per gallon higher than they were for last year’s holiday that marks the beginning of the summer driving season in the United States. The American Automobile Association has predicted that because of high gasoline prices, the rise in the number of Americans driving on the holiday will be the lowest in four years.

July contract Brent crude on the International Petroleum Exchange was up only 1 cent to $69.05 in late afternoon trade in London, but Brent traded in a wide range of $1.20 during the day. West Texas Intermediate crude June contracts were up 16 cents to $68.85 in early afternoon trade on the New York Mercantile Exchange, down more than 5 percent from its price at the beginning of the week.

Among precious metals, gold was down $8 after a sell-off late in the day, trading at $685.80/$683.60 per troy ounce.

Copper was also down on the day, losing $30 to $8,090 per tonne on the London Metal Exchange. The decline came after a report from the International Copper Study Group that showed a surplus of 52,000 tonnes of copper in February. Added to January’s surplus, the total surplus copper for the first two months of the year came to 117,000 tonnes, in contrast to a deficit of 55,000 tonnes for the same two months last year. Consumption for January and February this year was down 0.5 percent globally, according to the report, with Chinese consumption down 5.2 percent, EU usage down 4.7 percent, and US usage down 3.4 percent in the two months. Production was up in Australia, Congo, Peru, and Zambia, while it fell in Brazil, China, Indonesia, Kazakhstan, Mexico, and the US. Copper production in Chile remained unchanged.

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May 16, 2006

Commodities prices rebound

Filed under: Commodities, Oil, Metals, Economy

Crude oil prices were up on Tuesday after substantial declines on Monday. Brent crude June contracts dropped $2.65 on Monday but were back up 56 cents from Monday’s close in late trade on the International Petroleum Exchange to $70.23 per barrel. June contracts expire at the end of the trading day on Tuesday, so more attention became focused on July Brent contracts, which gained 87 cents to $71.05 per barrel. Meanwhile, West Texas Intermediate crude on the New York Mercantile Exchange saw June contracts add 89 cents to $70.30 per barrel. The gains come ahead of new US inventories numbers, due on Wednesday.

Precious metals were up as well. Gold added $8 to $688.90/$689.70 per troy ounce after dropping 4 percent on Monday. Silver was trading 25 cents higher at $13.40/$13.50, after losing 6 percent on Monday. Platinum, which lost less than other precious metals on Monday, added $23 to $1,293 per troy ounce on Tuesday.

Among base metals, copper added $220 to $8,410 after a 9 percent decline on Monday. It is back to within 5 percent of its record high price, reached on Thursday of last week. Part of the advance on the day were relaxed supply concerns after Grupo Mexico said it will not close its San Martin mine after all as striking miners have agreed to go back to work.

In other base metals, zinc was up $85 to $3,500 per tonne, while aluminium added $38 to $2,990 per tonne and nickel gained $450 to $20,450.

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May 11, 2006

Oil, metals continue rise

Filed under: Commodities, Oil, Metals, Economy

Supply concerns sent crude oil prices higher on Thursday. While Congress considered lifting import tariffs on ethanol in order to ease the pump price of gasoline, the Energy Information Administration said that such a move would only increase supplies by a little bit. June contract West Texas Intermediate crude on the New York Mercantile Exchange added $1.22 to $73.35 per barrel. Brent crude for June delivery on the International Petroleum Exchange was up 85 cents to $73.29 per barrel. Nymex unleaded gasoline for June was up 2.8 cents to $2.1975 per gallon.

In the metals markets, meanwhile, copper was up 6.2 percent to $8,575 per tonne, sliding back slightly after going as high as $8,790 per tonne earlier in the day, as inventories declined yet again in Europe and South Korea. In addition, Europe’s largest copper producer said that copper shortages were likely to continue.

Zinc hit a record $4,000 per tonne before falling back to $3,880 per tonne. Nickel added 3.7 percent to $21,200 per tonne on a decline in London Metal Exchange inventories of 594 tonnes. Aluminium gained 3.1 percent to $3,300 per tonne.

Among precious metals, gold was up 2.2 percent to $722.30 per troy ounce after going as high as $726.00 per troy ounce earlier in the day. Silver went as high as $15.17 per troy ounce before settling back to $14.93 per troy ounce. Platinum settled at $1,283 per troy ounce after hitting a new record of $1,293 per troy ounce during the day.

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May 10, 2006

Prices on copper, zinc hit new highs

Filed under: Commodities, Metals, Economy

Metals prices were up again on Wednesday, with copper and zinc both hitting new record highs and gold going above $700 per troy ounce. Silver was the only metal to see a decline on the day, dropping only fractionally to $14.34 per troy ounce.

Gold went as high as $704.50 per troy ounce during the day before settling back to $701.70 per troy ounce later on. If the dollar weakens any more after the Federal Reserve’s decision on interest rates, due today, most analysts expect gold to go even higher.

Elsewhere in the precious metals markets, platinum was up 0.9 percent to $1,249 per troy ounce after going up to a record $1,265 per troy ounce during the day.

Among base metals, copper breached the $8,000 level to hit a new record price of $8,085 per tonne during the day before settling back to $8,070 per tonne. Prices soared after Grupo Mexico said it would close its San Martin mines due to strikes. Also spurring supply concerns was a statement from Antofagasta that output from one of its mines in Chile will likely fall by 4.4 percent during 2006. Zinc was also affected by the Grupo Mexico announcement, gaining 5.5 percent to $3,660 per tonne, also a new record price.

Aluminum and nickel were both up as well. Nickel was up 1.8 percent to $20,300 per tonne after going as high as $20,450 during the day on continued talk of a strike against Canadian miner Inco. Meanwhile, aluminium added 2.8 percent to $3,095 on an expected rise in demand from automobile manufacturers.

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May 8, 2006

Crude prices down after Iran letter

Filed under: Commodities, Oil, Metals, Economy

The price of crude oil fell significantly on Monday after the president of Iran sent a letter to US President George W. Bush asking that a solution be found to “the current situation in the world”, referring to the dispute over Iran‘s nuclear program. This unusual step led hedge funds to close out some of their speculative long positions, which caused oil prices to soar to record highs last week, according to a report from the Commodity Futures Trading Commission. Despite this latest development, however, the International Energy Agency expects prices to remain high for at least the next two or three years.

The price of West Texas Intermediate crude for June delivery dropped $1.50 to $68.69 per barrel on the New York Mercantile Exchange. June contracts for Brent crude on the International Petroleum Exchange were down $1.46 to $69.44 per barrel.

In the precious metals markets, gold was driven up and down, then up again in reaction to the drop in the price of oil as well as in response to current conditions in the currency markets. Gold was as high as $684.70 per troy ounce and as low as $670 per troy ounce before settling in at $676.80 per troy ounce. Silver was down 1.4 percent to $13.75 per troy ounce, while platinum added 0.4 percent to $1,183 per troy ounce after going as high as $1,089 earlier in the day.

In base metals, copper dropped 0.2 percent to $7,640 per tonne on an increase of 1,800 tonnes in London Metal Exchange inventories. Supply concerns were also eased by the news that a strike at the Lomas Bayas mine in Chile had been called off. Nickel was slightly lower at $19,450 per tonne and zinc dropped 1.7 percent to $3,390 per tonne. Both copper and zinc had hit new record highs on Friday.

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