Home / In The News / Commodity

Commodity

Oil near multi-year highs

Oil prices steadied near 3-1/2 year highs on Friday as the prospect of new US sanctions on Iran tightened the outlook for Middle East supply at a time when global crude production is only just keeping pace with rising demand.

The United States plans to reintroduce sanctions against Iran, which pumps about 4 percent of the world’s oil, after abandoning a deal reached in late 2015 that limited Tehran’s nuclear ambitions in exchange for the removal of US and European sanctions.

The global oil market is finely balanced, with top exporter Saudi Arabia and No.1 producer Russia having led efforts to curb oil supply to prop up prices.

Benchmark Brent crude LCOc1 was down 20 cents at $77.27 a barrel in London trade on Friday. On Thursday Brent hit $78, its highest since November 2014. US light crude CLc1 was unchanged at $71.36, having touched a 3-1/2 year high of $71.89 on Thursday.

Many analysts expect oil prices to rise as Iran’s exports fall. “The up-trend remains strong and intact,” said Robin Bieber, technical chart analyst at London brokerage PVM Oil Associates. Rainer Seele, chief executive of Austrian oil and gas company OMV, told German daily Handelsblatt that he expects prices to rise as the United States moves to reimpose sanctions.

US investment bank Jefferies said in a note on Friday that it expects Iranian crude oil exports to start falling in the next few months.

Higher gas prices could spoil Trump’s tax cuts

Soaring crude oil prices have lifted national gasoline prices 21 percent over the past year. Drivers in nine states are paying $3 a gallon for regular gasoline.

Prices could continue to climb after President Donald Trump decided this week to sanction Iran, the world’s fifth largest oil producer. This pain at the pump threatens to drain some of the extra take-home pay that many households are enjoying from Trump’s tax cuts.

Higher gas prices are on track to cost Americans an extra $38 billion in 2018, wiping out about one-third of the direct benefit from the tax law, according to Morgan Stanley. The firm estimated that American households will take home an additional $128 billion in 2018 because of the new tax law.

Recommendation to make Pakistan sugar sector competitive

The Competition Commission of Pakistan (CCP) has recommended measures to the federal and provincial governments for making the sugar industry more efficient, improve sugarcane quality, enhance and diversify production processes, and focus on export competitiveness.

Taking notice of the sugarcane procurement crisis, the CCP held an open hearing on January 25, 2018, providing a platform to all stakeholders including representatives of the federal and provincial governments, growers, millers, retailers, distributors and consumers to express their concerns.

In its opinion following the open hearing, the CCP recommended that the federal government abolish the price floor/support price of sugarcane and let the market determine the price based on supply and demand.

 

Wheat lower as rains target Russia; USDA data awaited

US wheat futures fell to a one-week low on Wednesday on position-squaring ahead of a monthly crop report from the US Department of Agriculture and forecasts for welcome rains in Russia’s crop belt, analysts said. Soybean and corn futures were also lower ahead of the USDA’s report, while soyoil futures firmed, following strength in crude oil.

As of 1:07 p.m. CDT (1807 GMT), Chicago Board of Trade July wheat was down 4 cents at $5.10-1/2 per bushel after dipping to $5.06-1/4, its lowest since May 1. CBOT July soybeans were down 3-1/2 cents at $10.16-3/4 a bushel and July corn was down 3/4 cent at $4.02-1/2.

Copper falls as stronger dollar overpowers positive China data

Copper prices fell on Tuesday as the effect of a strengthening dollar overshadowed positive trade data from China, the world’s largest consumer and producer of industrial metals. Chinese imports and exports grew more strongly than expected in April and copper imports rose 2.8 percent from the previous month, implying healthy demand and pushing prices higher in early trading. But interest was curbed by the dollar, which reached a new 2018 high against a basket of major currencies, making dollar-denominated industrial metals more expensive for users of other currencies.

Robusta coffee falls as producer hedging weighs

Robusta coffee futures on ICE fell further on Wednesday, after a wave of producer hedging halted the market’s recent advance, while New York cocoa and raw sugar prices also slipped.

July robusta coffee was down $28, or 1.6 percent, at $1,766 a tonne by 1101 GMT, after hitting a session low of $1,758. The market last week tapped $1,845, its highest since November 2017, partly supported by dwindling certified stocks. However, dealers said the market’s advance above the $1,800 mark had attracted heavy producer hedging on Tuesday, which knocked prices lower and encouraged follow-through selling.

Bangladesh tea prices flat amid supply glut

Tea prices in Bangladesh were barely changed at the weekly auction amid a higher supply than the previous sale, although strong demand for quality leaf capped a steeper price decline. Bangladeshi tea fetched an average of 213.09 taka ($2.6) per kg at the auction, compared with 213.02 taka at the previous sale when prices dropped 2.7 percent. There was muted demand overall but good demand for quality leaf, which helped limit a steep drop in prices when supplies were higher than last week, a senior official at National Brokers said. Nearly 7.2 percent of the 1.18 million kg offered at the auction centre in Chittagong was unsold. At the previous auction, around 810,500 kg was offered, of which 6.2 percent went unsold.

Check Also

Gulf News

Gulf

DIFC hold talks for enhanced cooperation with China Officials at the Dubai International Financial Centre …

Leave a Reply