Oil prices hit highest since mid-2015
US oil prices hit their highest since mid-2015 on the final trading day of the year as an unexpected fall in American output and a fall in commercial crude inventories stoked buying. In international markets, Brent crude oil futures also rose, supported by ongoing supply cuts by top producers OPEC and Russia as well as strong demand from China.
US West Texas Intermediate (WTI) crude futures were at $60.21 a barrel in the Asian trade on Friday, up 37 cents or 0.6 percent from their last close, after hitting a June 2015 high of $60.32 earlier in the day. Brent crude futures – the international benchmark – were also up, rising 45 cents or 0.7 percent to $66.61 a barrel. Brent broke through $67 earlier this week for the first time since May 2015.
Friday’s WTI price rises were driven by a surprise drop in US oil production, which last week dipped to 9.754 million barrels per day (bpd), down from 9.789 million bpd the previous week, according to data from the Energy Information Administration (EIA) released late on Thursday.
US output is still up by almost 16 percent since mid-2016, but most analysts had expected production to break through 10 million bpd by the end of this year – a level only surpassed by top exporter Saudi Arabia and top producer Russia. WTI prices were further boosted by a fall in US commercial crude storage levels, which dropped by 4.6 million barrels in the week to Dec. 22 to 431.9 million barrels, according to the EIA. Inventories are now down by almost 20 percent from their historic highs last March, and well below this time last year or in 2015.
Gold, silver boosted by bullish charts, slumping dollar
Gold and silver markets ended the US day session with moderate gains and hit new four-week highs on Wednesday.
The precious metals bulls have technical momentum amid fledgling price uptrends on the daily charts, which are drawing in more chart-based buyers. A weaker US dollar index that dropped to a four-week low today also helped out the precious metals bulls.
February Comex gold was last up $4.40 an ounce at $1,291.90. March Comex silver was last up $0.161 at $16.765 an ounce. It has been a quieter trading and news week so far, as many traders and investors are out during the holiday season.
US milk production up in November
Milk production in the 23 major states in US was up by 1.1 percent in November, compared to the same month in 2016, according to the latest figures from US Department of Agriculture (USDA). This increase in the 23 major states brought the total milk production to 16.2 billion pounds. Production figures for October were also revised to 16.7 billion pounds, meaning production was up 1.3 percent year-on-year in the tenth month of the year. This revision represented a decrease of 27 million pounds or 0.2 percent from last month’s preliminary production estimate, according to the USDA. Across the US as a whole, the level of milk production was up by 1 percent in November, compared to the same month last year.
TOCOM rubber rises after top producers agree to cut exports until March
Benchmark Tokyo rubber futures rose on Monday, helped by news that top producing countries have agreed to slash exports by up to 350,000 tons until March next year, but trades were thin due to the holiday season.
A group of three of the world’s top natural rubber producers will cut exports by up to 350,000 tons in total from now until March, the Thai agriculture ministry said on Friday, in a bid to address declining global prices.
The Tokyo Commodity Exchange (TOCOM) rubber contract for new June delivery finished at 208.4 yen ($1.84) per kg, up 4.2 yen from an opening price of 204.2 yen.
Ice coffee, sugar rise, London cocoa futures drop
ICE sugar and arabica coffee prices extended their advance on short-covering on Wednesday, even as they remained set to finish lower for the year, while London cocoa fell on a firmer British pound and expectations of large supplies. London soft commodities markets reopened after being closed for Christmas and UK Boxing Day holidays.
March raw sugar on ICE Futures US settled up 0.23 cent, or 1.56 percent, at 14.93 cents per lb, after touching 14.94 cents, its highest since Dec. 5. The 14.85-14.89 range was strong resistance, and we got through it and aren’t backing off yet. Index funds are expected to have to buy around 60,000 lots of the commodity in January when they rebalance their investments, after sugar’s price rout this year. Benchmark prices are poised to end 2017 down over 23 percent, the biggest loss since 2011.
Palm drops on high inventory, subdued related edible oils
Malaysian palm oil futures declined in early trade on Thursday, after hitting their highest level in more than a week in the previous session, as ample supplies dented sentiment. Other related edible oils were trading largely flat, with March soybean oil contract on the Chicago Board of Trade and May soybean oil on the Dalian Commodity Exchange edging up 0.1 percent each.
The Dalian January palm oil contract was up 0.4 percent. Palm oil prices are also impacted by movements in other edible oils, as they compete for a share of the global vegetable oils market.
The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange fell 0.3 percent at 2,531 ringgit ($621.10) a ton at the midday break. It had risen to its highest level in over a week in the previous session, and is up 3.3 percent for the week.
Wheat edges lower, but adverse us weather stems losses
US wheat futures edged lower on Thursday, falling after posting gains of more than 1 percent in the previous session, though the drop was capped amid ongoing concerns about potential crop losses from recent cold weather across the United States. Soybeans edged down, retreating from a near two-week high touched in the previous session, while corn fell.
The most active wheat futures on the Chicago Board Of Trade were down 0.2 percent at $4.27-1/4 a bushel in early trade, having closed up 1.4 percent on Wednesday. Despite the drop, traders said prices remain supported by concerns for potential yield losses as cold weather lingers across the US Plains.