Oil tumbled this week after the International Energy Agency (IEA) agreed to draw on emergency reserves to make up for lost Libyan supplies and as global economic recovery fears prompted demand concerns.
“The big thing this week was really IEA’s decision to release 60 million barrels of crude oil over the next month — taking the teeth out of any possible price spikes in crude oil as we move into higher demand in the third quarter of 2011,” SEB commodities analyst Bjarne Schieldrop said. “So, pre-emptive action from IEA and US politicians to safe-guard the fragile economy as we move into higher oil demand.”
However, he cautioned that the impact would be somewhat limited because the move did not solve medium term supply issues.
“On a week-on-week basis, the changes in commodity prices are fairly small since last Friday’s close — except for crude and energy,” Schieldrop added.
Agricultural commodities, meanwhile, were subdued after G20 farming ministers from the world’s top economies agreed on action to curb speculative trading blamed for recent food price spikes, at a key meeting in Paris.
The agreement supports establishing an international agricultural market information system, or AMIS, to remedy a chronic lack of output and stocks data that is seen as a major source of price volatility.
OIL: Prices slumped as the IEA, the energy arm of the OECD, -announced it would tap emergency crude reserves of its 28 member nations.
Brent North Sea crude for delivery in August nosedived by a hefty US$6.95, or 6.0 percent, in value on Thursday.
The IEA sparked a steep sell-off when it announced its decision to release 60 million barrels of crude. Prior to the announcement, the market was already buckling under the weight of a stronger US dollar, spreading global economic gloom and contagion fears arising from the Greek-eurozone debt crisis.
The shock IEA move is intended to replace output from Libya, where a revolt has practically halted production.
However, some analysts said Thursday’s heavy price falls were overdone in light of the outlook.
By late Friday on London’s Intercontinental Exchange, Brent North Sea crude for delivery in August tumbled to US$105.95 a barrel from US$112.84.
On the New York Mercantile Exchange, West Texas Intermediate or light sweet crude for August dived to US$90.92 a barrel from US$92.70 the previous week for the July contract.
PRECIOUS METALS: Gold, silver, platinum and palladium finished the week in negative territory.
“Gold is caught up in the downward pull on commodity markets caused by oil,” Commerzbank analysts said.
The stronger US currency made commodities priced in US dollars more expensive for buyers using weaker currencies, denting -demand and prices.
By late Friday on the London Bullion Market, gold dipped to US$1,514.75 an ounce from US$1,537.50 the previous week.
Silver slid to US$34.73 an ounce from US$35.39.
On the London Platinum and Palladium Market, platinum dived to US$1,696 an ounce from US$1,751.
Palladium fell to US$739 an ounce from US$754.
Nessun commento:
Posta un commento