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Commodities Extend Decline to Lowest Since July 2009

Posted on 16 September 2014 by VRS  |  Email |Print

Commodities rose after touching the lowest level in more than five years on signs demand growth is weakening in China, the biggest consumer of energy and metals, and on speculation U.S. borrowing costs may rise next year.
The Bloomberg Commodity Index of 22 futures dropped as much as 0.4 percent to 120.7641, the lowest level since July 2009, before trading at 121.3571 at 3:41 p.m. in New York. The gauge has lost 3.5 percent in 2014 and is set for a fourth year of decline. Brent crude fell to the lowest in more than two years as corn and soybeans traded near 2010 lows………………………………………..Full Article: Source

Commodities brace for more woe ahead of Fed rate decision

Posted on 16 September 2014 by VRS  |  Email |Print

Major commodity markets, many already trading near multi-year lows, could face more pressure should the U.S. Federal Reserve fuel fresh gains in the U.S. currency this week, weighing on dollar-priced raw materials.
The mere prospect of a climb in U.S. interest rates has lifted the dollar to multi-month highs, and it may rise further if the Fed confirms on Wednesday after its policy meeting that a rate hike may come sooner rather than later. This would be bad news for commodities, analysts and investors said, due to their strong negative correlation with the U.S. dollar………………………………………..Full Article: Source

Russia’s challenge to an oil-hungry world

Posted on 16 September 2014 by VRS  |  Email |Print

The oil price may be falling and global demand is “remarkably” subdued, according to a report last week from the International Energy Agency. But this has not stopped the former chief executive of BP, Tony Hayward, from issuing an uncomfortable warning.
In an interview with the FT, Mr Hayward, who these days runs an oil company in Iraqi Kurdistan, worries that international sanctions against Russia’s oil sector are storing up trouble for the west. They risk cutting investment and damaging supplies from the world’s third-largest producer. The threat may have been masked by increases in American liquid petroleum production, which has surged above its 1970 zenith………………………………………..Full Article: Source

IEA Cuts 2015 Oil Demand Forecasts

Posted on 12 September 2014 by VRS  |  Email |Print

The International Energy Agency Thursday trimmed its forecast for the rise in oil demand this year for the third month in a row, calling the recent slowdown in demand “nothing short of remarkable.” In its closely watched monthly oil market report, the Paris-based energy watchdog said it expects global oil demand to grow by 0.9 million barrels a day in 2014, a decrease of 65,000 barrels a day compared with last month’s forecast and down by 300,000 barrels a day since July.
According to the IEA, oil demand growth in the second quarter was at its lowest in 2½ years, dented by economic weakness in Europe and China, a trend the agency expects will continue to weigh on demand………………………………………..Full Article: Source

Oil slumps to two-year low on IEA demand downgrade

Posted on 12 September 2014 by VRS  |  Email |Print

Global oil prices hit a two-year low today after the International Energy Agency cut its forecasts for world demand, with the market also weighed down by plentiful supplies, analysts said.
In earlier London trade, Brent North Sea crude for October sank to USD 96.72 per barrel — the lowest point since July 2, 2012. And US benchmark West Texas Intermediate (WTI) for October delivery slid to USD 90.43 — a level last seen on May 1, 2013………………………………………..Full Article: Source

No need for urgent OPEC meet on lower oil price: Kuwait

Posted on 12 September 2014 by VRS  |  Email |Print

OPEC member Kuwait said on Thursday there was no need to call an emergency meeting for the producers` cartel to discuss sliding oil prices after crude hit a 17-month low. “We do not believe there is a need to call an emergency OPEC meeting” to discuss the drop in prices, Oil Minister Ali al-Omair told reporters at the end of a regular meeting of the oil ministers of the Gulf Cooperation Council (GCC).
“So far, we are confident that prices have not dropped to the extent that makes us call for an emergency meeting,” Omair said. Oil prices fell in Asia Thursday after coming under pressure due to weak global demand and a supply glut, even as US President Barack Obama vowed to destroy jihadist militants in Syria and oil-rich Iraq………………………………………..Full Article: Source

China holds “Gold Congress,” positioning itself as global gold hub

Posted on 12 September 2014 by VRS  |  Email |Print

The China Gold Congress is currently in full flight in Beijing. The three day Congress is China’s biggest gold industry event of the year, drawing in participants from across the Chinese and international gold sectors including central banks, mining companies, bullion banks and refiners.
The event, co-sponsored by the World Gold Council (WGC) and the China Gold Association, showcases China’s gold industry and acts as a focus point for what is now the world’s largest gold market in terms of demand and product innovation………………………………………..Full Article: Source

Emerging market buying power for commodities has actually improved

Posted on 11 September 2014 by VRS  |  Email |Print

Since commodities are priced in U.S. dollars and a stronger greenback equates to a loss of purchasing power by commodity buyers, investors have been wise to avoid commodity cyclicals when the U.S. dollar is rising. But Canaccord Genuity portfolio strategist Martin Roberge points out that this approach fails to recognize that emerging markets have become the dominant buyers of commodities in recent years, as opposed to developed markets in the past.
For example, trade balance data show that EMs have become net commodity importers of industrial commodities such as base metals, fertilizers and forest products since 2008 and developed markets are now net exporters………………………………………..Full Article: Source

U.S. CFTC to allow commodity hedge funds to advertise to public

Posted on 11 September 2014 by VRS  |  Email |Print

U.S. derivatives regulators are removing a legal hurdle, which will open the door for hedge funds and other private funds to reach new investors through television, the Internet and other media channels. The Commodity Futures Trading Commission announced the move late on Tuesday in a staff “exemptive” letter to the industry.
The CFTC’s decision to permit private funds to advertise reflects an effort to harmonize outdated rules that conflict with a 2012 law that lifted an 80-year-old advertising ban for hedge funds and other private investment vehicles………………………………………..Full Article: Source

Commodities Drop to Lowest Since January as Dollar Climbs

Posted on 10 September 2014 by VRS  |  Email |Print

Commodities declined to the lowest in almost eight months as the dollar advanced on speculation that the Federal Reserve will increase interest rates next year, curbing demand for raw materials. The Bloomberg Commodity Index (BCOM) that tracks 22 futures lost as much as 0.7% to 123.4334, the lowest since Jan. 10 and settled at 123.4755 in New York. Nickel tumbled the most since May, corn traded at a four-year low and Brent crude dropped to the lowest in 17 months.
The dollar, as measured by the Bloomberg spot index that tracks the greenback against 10 peers, climbed to a 14-month high before U.S. data this week forecast to show jobless claims fell and retail sales improved. Fed policy makers will meet on Sept. 16-17. Advances in the greenback make dollar-priced commodities more expensive in terms of other currencies………………………………………..Full Article: Source

ECB president Mario Draghi surprises Commodities market with boldness

Posted on 10 September 2014 by VRS  |  Email |Print

European Central Bank President Mario Draghi once again demonstrated a boldness that surprised commodities market last week when the ECB not only cut interest rates but announced the purchase of asset-backed securities.
Draghi recalls his track record and he reversed (former ECB President Jean-Claude) Trichet’s rate hikes almost immediately upon taking office. He nearly single-handedly ended the existential crisis facing (the) euro by aligning the ECB with the preservation of the monetary union, said Brown Brothers Harriman………………………………………..Full Article: Source

US EIA: Trims 2014 Oil Demand Outlook, Upgrades Non-OPEC

Posted on 10 September 2014 by VRS  |  Email |Print

The U.S. Energy Information Administration Tuesday lowered its forecast for how much it sees world oil demand growing in 2014, while upgrading its expectation regarding the amount of supply that will come from non-OPEC producers this year. The agency reported in its September Short Term Energy Outlook that U.S. oil output in 2015 will likely average its highest level in 44 years, but cut it’s projection for U.S. gasoline prices and international oil prices.
“The recent inventory builds are somewhat atypical for this time of year and signal a relatively loose global crude oil market compared with conditions over the past three years,” the EIA said, adding that, “Weaker oil demand and lower refinery runs in European and Asian countries within the Organization for Economic Cooperation and Development (OECD) this year have reduced market tightness.”……………………………………….Full Article: Source

Oil market pricing escapes linkage to financial benchmark regulations

Posted on 10 September 2014 by VRS  |  Email |Print

The oil market’s price setting agencies have avoided being linked to the kind of regulation trained on financial benchmarks, in a report by international regulators.
The decision by the International Organization of Securities Commissions (IOSCO) comes as the European Union is investigating allegations of oil price manipulation, which has involved searching the offices of major oil companies and pricing agencies………………………………………..Full Article: Source

Gold demand to soar as festive season kicks off in India

Posted on 10 September 2014 by VRS  |  Email |Print

Gold prices have traditionally rallied in in September as India, the world’s second-largest gold buyer, stocked up on the yellow metal ahead of its wedding season around Diwali. But investors hoping the Indian Festival season will boost the metal’s ailing price are likely to be disappointed, analysts say.
“Demand is definitely picking up because of the festival season approaching but we don’t see a big spurt in the demand,” Surendra Mehta, secretary of the India Bullion and Jewellers’ Association told FT.com. “Only the people who need gold are buying now, there are no investors.”……………………………………….Full Article: Source

How to tackle India’s gold glut: recycle it

Posted on 09 September 2014 by VRS  |  Email |Print

Import restrictions and the rival appeal of equities have put a damper on India’s gold market, traditionally the world’s biggest. As festival season gets under way and Indians indulge their craving for the yellow metal, many are wondering when New Delhi and the Reserve Bank of India will begin rolling back their efforts to keep the market in check.
Officials are particularly concerned about the effect of gold imports on India’s troublesome current account deficit. One way round that problem would be to encourage more recycling of gold already in India. It could also be an enticing business proposition………………………………………..Full Article: Source

BNP Said to Reduce Commodity-Trade Finance to Trafigura

Posted on 09 September 2014 by VRS  |  Email |Print

BNP Paribas SA (BNP), the French bank that paid a record fine two months ago for breaking U.S. sanctions, is cutting commodity-trade finance to Trafigura Beheer BV, according to two people with knowledge of the matter.
Executives at Trafigura, the world’s second-largest metals trader, contacted other banks to discuss BNP Paribas’s withdrawal, said the people, who asked not to be identified because they’re not authorized to speak about it. The Trafigura executives said the move is part of a broader exit from the business by France’s biggest lender, according to one of the people………………………………………..Full Article: Source

Global oil industry needs to ramp up on its human resources

Posted on 08 September 2014 by VRS  |  Email |Print

The oil and gas industries, whether upstream or downstream, are so important to the well-being of the global economy in general and the producing countries in particular.
They are characterised by high capital and operating costs, the risk of life- and property-threatening incidents, the high degree of technology involved, impact on the environment and the need to develop the necessary workforce for profitable, risk-free and environmentally safe industries………………………………………..Full Article: Source

The Big Shift In US Oil Markets

Posted on 08 September 2014 by VRS  |  Email |Print

The shale revolution at work today across the oil and gas industry was made possible by scrappy entrepreneurs risking their own capital and futures to pursue opportunities from onshore exploration and production in tight oil and gas formations and shale plays that the larger majors and super majors ignored.
While the biggest players went offshore in the deeper water looking for big reserve growth, these revolutionaries used commercially available technologies available to them in 3D seismic imaging, horizontal drilling, and hydraulic fracturing to change the industry—and the world………………………………………..Full Article: Source

Will Silver Bounce Back?

Posted on 08 September 2014 by VRS  |  Email |Print

The silver market cooled down mainly at the beginning of last week. The recent disappointing non-farm payroll report didn’t pull back up (by much) the price of silver. Moreover, even the latest surprise from the ECB to slash its rate didn’t seem to have much of an impact on the silver market. Looking forward, will this week’s job openings and labor turnover survey (JOLTS) report pull up silver?
During the previous week, the price of silver fell by 1.7% to reach $19.1. The silver ETF iShares Silver Trust also declined by 1.5%. Silver related companies such as Silver Wheaton also fell by 3.5%………………………………………..Full Article: Source

BNP Paribas Said to Curb Commodity-Trade Finance to Trafigura

Posted on 08 September 2014 by VRS  |  Email |Print

BNP Paribas SA, the French bank that paid a record fine two months ago for breaking U.S. sanctions, is cutting commodity-trade finance to Trafigura Beheer BV, according to two people with knowledge of the matter.
Executives at Trafigura, the world’s second-largest metals trader, contacted other banks to discuss BNP Paribas’s withdrawal, said the people, who asked not to be identified because they’re not authorized to speak about it. The Trafigura executives said the move is part of a broader exit from the business by France’s biggest lender, according to one of the people………………………………………..Full Article: Source

Commodity trading: End-to-end game

Posted on 05 September 2014 by VRS  |  Email |Print

Banks, harried by regulators and short of capital, are fleeing the commodities business. Deutsche Bank, Morgan Stanley and UBS either shuttered or shrank their commodities operations last year; this year Barclays, Credit Suisse and JPMorgan Chase have scaled back. But even as they retreat, commodity-trading houses, most of which began life as simple middlemen, are getting ever more deeply involved in the extraction, shipping and refining of raw materials.
The buyer of JPMorgan Chase’s physical commodities unit, for instance, was Mercuria, a ten-year-old firm based in Switzerland that started out trading oil but now owns (or has joint ventures with) oil-exploration companies, oil-terminal and pipeline operators, coal and iron-ore mines and biofuel refineries………………………………………..Full Article: Source

India: Insurers bet big on agri commodities

Posted on 05 September 2014 by VRS  |  Email |Print

Non-life insurers are betting highly on the Forward Markets Commission (FMC)’s proposed norms relating to commodities trade. According to the norms, warehouse service providers (WSPs) will have to provide full insurance covers to deliverable commodities on futures exchanges.
In draft guidelines issued on August 26, the FMC said WSPs seeking accreditation with the National Multi Commodity Exchange would have to fully cover the value of goods at exchange-approved warehouses for risks such as fires, floods, cyclones, earthquakes, burglaries, thefts, etc………………………………………..Full Article: Source

EU plans to target Russian oil groups with new sanctions

Posted on 05 September 2014 by VRS  |  Email |Print

The EU is preparing to bar Russia’s state-controlled oil companies from raising funds on European capital markets, a significant expansion of the bloc’s economic sanctions that would hit some of the country’s largest energy groups, including Rosneft.
The ban, contained in legislation approved by the European Commission and obtained by the Financial Times, would also be applied to Russian defence companies and would add to a similar restriction adopted in July on Russian banks seeking to raise cash in Europe………………………………………..Full Article: Source

How to find, well, gold, in the troubled mining sector

Posted on 05 September 2014 by VRS  |  Email |Print

Gold prices are hovering near a two-month low, but some analysts say there is still value in the companies that mine the precious metal. Gold for December delivery, the currently most-traded active contract, on Wednesday rose by US$5.50, or 0.4%, to US$1,270 an ounce as of 4 p.m. on the New York Mercantile Exchange.
The metal’s stagnant price has raised questions about the financial health of gold miners, which require gold to remain at a certain price to profitably mine it. But CIBC World Markets said some gold companies offer attractive value even at current prices………………………………………..Full Article: Source

Palladium Wins Another Week Of Geo-Politics

Posted on 05 September 2014 by VRS  |  Email |Print

Although it’s been relatively quiet due to the holiday season, Palladium has been the winner this week, while for GoldMoney customers, Silver has also outshone its glittering yellow cousin. Dealing Manager at the online precious metals trader, Kelly-Ann Kearsey, said: “Activity has been as you’d expect for this time of year, although it’s picked up on last week and we’ve still got more buyers than sellers. Among our customers we’ve seen some significant silver purchases, which have gone into the eastern vaults, most particularly Hong Kong, but muted interest for gold.”
Geo-political concerns are undoubtedly one of the major influencers on the market at the moment. Despite the strength of the dollar the concerns have supported the gold price at the 1300 level………………………………………..Full Article: Source

Is Gold Knocking On Intrinsic Value’s Door?

Posted on 04 September 2014 by VRS  |  Email |Print

From 2008 through 2011, Gold was a hotly debated subject within financial circles as we acclimated to the idea that the Fed could double and triple its balance sheet and somehow not debase the dollar. On the one hand there were gold bugs who said that gold was the only true form of money based on the precedent of thousands of years of economic history.
On the other side there was the intelligentsia, which argued that gold was a “barbaric relic” utilized by uncivilized people and that its value was purely psychological. At first, gold bugs had the advantage in the debate — between 2008 and 2011 gold’s price rose by 150%. But since then, the price has fallen by 35% from its peak. Indeed, as gold prices collapsed and stocks soared, the gold debate has seemingly faded from the discourse………………………………………..Full Article: Source

Uranium poised to enter bull market

Posted on 04 September 2014 by VRS  |  Email |Print

Uranium is poised to enter a bull market amid tightening supply as producers shut mines and delay projects, more than three years after the Fukushima nuclear disaster in Japan sent prices lower.
The atomic fuel has advanced as much as 18 percent from a May 20 low of $28 a pound, according to data from Ux Consulting Co. in Roswell, Georgia, which provides research on the nuclear industry. Prices closed 0.5 percent higher at $32.65 yesterday and have averaged $31.80 in 2014………………………………………..Full Article: Source

HSBC Global Research Commodity prices snapshot

Posted on 03 September 2014 by VRS  |  Email |Print

Global commodity prices fell in August, with declines across a broad range of commodity types. Our indicator suggests the IMF commodity price index is likely to have fallen by -4.0% in August, to be -4.2% lower than a year earlier. For the second month in a row, oil prices fell noticeably despite on-going geopolitical tensions.
Meanwhile, the prospect of a good harvest in the northern hemisphere continued to weigh on a broad range of agricultural commodity prices, particularly grains and vegetable oils. Metals prices were more mixed, with aluminium continuing its recent price gains, while copper and nickel prices fell. (Press Release)

Oil Prices Fall Sharply on Weak Demand Outlook, Stronger Dollar

Posted on 03 September 2014 by VRS  |  Email |Print

Oil prices dropped more than $3 a barrel Tuesday as disappointing Chinese and European economic data and a stronger dollar weighed on demand expectations. Oil prices have tumbled in recent weeks as weak demand from European and Asian refineries forced sellers to cut prices and global supplies remained ample despite violence in some regions. Recent data indicates that tepid demand could continue in the coming months.
U.S. oil prices rose last week for the first time in five weeks as traders who had bet on lower prices closed out their wagers, in case unrest in any geopolitical hot spots worsened during the long holiday weekend. The Nymex market was closed Monday for Labor Day and reopened Tuesday………………………………………..Full Article: Source

Swiss NGO proposes commodities watchdog

Posted on 02 September 2014 by VRS  |  Email |Print

The non-governmental Berne Declaration group has called for the creation of an independent supervisory authority to oversee the Swiss commodities market. It says it is not good enough to allow the sector to regulate itself.
At the launch of its latest campaign to fight ongoing corruption, inequality and environmental issues in the worldwide commodities sector, the pressure group said an independent regulator would help counter the “resource curse”. “Switzerland as the world’s most important commodities hub has a political responsibility to act,” Andreas Missbach told a news conference on Monday………………………………………..Full Article: Source

Putin breaks ground on Russia-China gas pipeline, world’s biggest

Posted on 02 September 2014 by VRS  |  Email |Print

Russian President Vladimir Putin and Chinese Vice Premier Zhang Gaoli have launched the construction of the first part of Gazprom’s Power of Siberia pipeline - which will deliver 4 trillion cubic meters of gas to China over 30 years.
“The new gas branch will significantly strengthen the economic cooperation with countries in the Asia-Pacific region and above all - our key partner China,” Putin said at the ceremony outside the city of Yakutsk - the capital of Russia’s Republic of Yakutia on Monday………………………………………..Full Article: Source

Gold Speculators Cut Back Bullish Bets As Prices Remain Under $1,300

Posted on 02 September 2014 by VRS  |  Email |Print

Gold market traders and speculators cut back on their overall bullish bets last week for a second consecutive week and to the lowest level in over two months, according to the latest Commitment of Traders (COT) data released by the Commodity Futures Trading Commission (CFTC) on Friday.
The non-commercial futures contracts of Comex gold futures, traded by large speculators and hedge funds, totaled a net position of +113,169 contracts in the data reported through August 26th. This was a weekly change of -24,807 contracts from the previous week’s total of +137,976 net contracts that was registered on August 19th………………………………………..Full Article: Source

Copper Declines on China’s Manufacturing Data for August

Posted on 02 September 2014 by VRS  |  Email |Print

Copper fell in London on signs that factory demand will slow in China, the world’s largest consumer of the industrial metal. The purchasing managers’ index from the China Federation of Logistics and Purchasing dropped to 51.1 for August from 51.7 in July. Economists surveyed by Bloomberg projected 51.2.
China’s copper output rose to a six-month high in July and Goldman Sachs Group Inc. forecasts more smelting capacity in the second half, curbing imports of the refined metal. Prices declined 5.7 percent this year………………………………………..Full Article: Source

What’s Behind the Current Global Commodity Price Slump?

Posted on 01 September 2014 by VRS  |  Email |Print

As the year 2014 got underway, it looked as if commodities in general, and energy, in particular, were headed for a boom year. And with an accelerating economic recovery, U.S. Treasury interest yields surprisingly dropping to post-recession lows, along with deteriorating geopolitical turbulence, the first quarter did not disappoint.
In fact, the newly-christened Bloomberg Commodity Index (renamed from DJ-UBS Index) reached the best quarter since the beginning of the 2008 recession. In doing so, it far surpassed the stock market’s S&P 500 performance during the first quarter 2014. But by the middle of May, a remarkable reversal set in, and has followed with a downdraft that brought the Bloomberg Industrial commodities down from the first quarter’s 21% growth peak to a negative 10% drop into the early part of August, with no rebound in sight………………………………………..Full Article: Source

OPEC Oil Output Hits One-Year High in August on Nigeria

Posted on 01 September 2014 by VRS  |  Email |Print

OPEC crude oil production increased to a one-year high in August, led by surging output in Nigeria, a Bloomberg survey showed. Production by the 12-member Organization of Petroleum Exporting Countries rose by 891,000 barrels a day to 31.033 million, according to the survey of oil companies, producers and analysts. Last month’s total was revised 80,000 barrels a day lower to 30.142 million because of changes to the Nigerian and Iranian estimates.
Nigeria, Saudi Arabia and Angola led gains as new deposits came online, security improved and field maintenance programs ended. Iran and Venezuela were the only members to record production declines………………………………………..Full Article: Source

Speculators Turn More Bullish on Oil Before Labor Day

Posted on 01 September 2014 by VRS  |  Email |Print

Hedge funds increased bullish positions on crude oil for the first time in more than a month, benefiting from a rally before the Labor Day holiday weekend.
Money managers increased net-long positions in U.S. benchmark West Texas Intermediate oil by 0.6 percent in the seven days ended Aug. 26, boosting bullish wagers from a 16-month low, Commodity Futures Trading Commission data showed. WTI climbed 2.5 percent last week, the first gain since July………………………………………..Full Article: Source

Gold’s Headwinds Now Starting To Fade - Look For Higher Prices Ahead

Posted on 01 September 2014 by VRS  |  Email |Print

Positive seasonal factors are now in effect for precious metals and this should help push prices higher in the period ahead. A stronger dollar continues to limit gold and silver price gains, however, a dovish Federal Reserve could cause the dollar rally to reverse course. Safe haven demand remains strong and this too could boost demand precious metals this fall.
Gold and silver prices rose together for the first time in seven weeks, but the metals stayed within well-defined ranges during quiet, end-of-summer trading, setting the stage for positive seasonal factors and possibly rising prices in the period ahead. The strengthening dollar continues to be a major impediment to higher metal prices and dollar bearish developments are sorely needed for any sustained gold rally this fall………………………………………..Full Article: Source

Global recovery continues at varying speeds, equity the best bet: Bank J Safra Sarasin

Posted on 01 September 2014 by VRS  |  Email |Print

As the global economic recovery is continuing at varying speeds equities remain the most attractive asset class mid-term, a report by Bank J. Safra Sarasin said. The US leads the global cycle with growth significantly higher than in Euroland.
Euroland is hampered by high debt levels, ongoing economic imbalances, adverse geopolitical headwinds like the crisis in Ukraine and the urgent need for structural reforms, the report said.Inflation remains low globally, preventing a premature increase of policy rates and a bond market crash. The spectre of deflation is particularly strong in Euroland and needs to be addressed by demand and supply side policies………………………………………..Full Article: Source

A New American Oil Bonanza

Posted on 29 August 2014 by VRS  |  Email |Print

Whenever overseas turmoil has pushed energy prices higher in the past, John and Beth Hughes have curbed their driving by eating at home more and shopping locally. But the current crises in Ukraine and Iraq did not stop them from making the two-hour drive to San Antonio to visit the Alamo, have a chicken fried steak lunch, and buy fish for their tank before driving home to Corpus Christi.
“We were able to take a day-cation because of the lower gas prices,” said Ms. Hughes. The reason for the improved economics of road travel can be found 10,000 feet below the ground here, where the South Texas Eagle Ford shale is providing more than a million new barrels of oil supplies to the world market every day………………………………………..Full Article: Source

OPEC oil output rises in August as Libyan recovery holds

Posted on 29 August 2014 by VRS  |  Email |Print

OPEC’s oil production has risen in August from July, a Reuters survey found on Thursday, as a recovery in Libyan supply held up and Angola and Iran boosted supplies, outweighing a further decline in Iraq.
The survey also found Saudi Arabia and other core Gulf OPEC producers kept output largely flat and have not cut back to prop up prices, which in August dipped to a 14-month low near $101 a barrel, or to make room for higher Libyan output………………………………………..Full Article: Source

Gold demand: Not so hot, not so cold

Posted on 29 August 2014 by VRS  |  Email |Print

As pointed out by the Fed Chairman Janet Yellen, how much slack there is in the U.S. labour market is still up for debate. The Fed uses a Labour Market Conditions Index, which consists of 19 factors. The undertone is that the underuse of the labour force is still big although a few Fed governors have been saying that the interest rates will rise sooner than expected.
The ECB governor surprised the market by saying for the first time that both the fiscal and monetary policies are necessary to stimulate aggregate demand, which means there is room for more asset purchases and possibly QE and more fiscal policy flexibility from the governments………………………………………..Full Article: Source

Hedge funds continue bearish positions on commodities

Posted on 27 August 2014 by VRS  |  Email |Print

Hedge funds have extended their misfortune on agricultural commodities, as increasingly negative sentiment on sugar and livestock more than offsets a reevaluation of laid-back positioning on wheat.
According to data from the Commodity Futures Trading Commission regulator, managed money cuts its net long position in futures and options in the top 13 U.S.-traded agricultural commodities from coffee to corn by more than 18,000 contracts in the week leading up to last Tuesday. It was the eighth consecutive week in which hedge funds reduced their net long………………………………………..Full Article: Source

IEA: U.S. LNG won’t matter much for Europe

Posted on 27 August 2014 by VRS  |  Email |Print

Liquefied natural gas sent from North America to European markets likely won’t make much of a regional difference, the director of the IEA said from Norway. International delegates are gathered for an annual energy conference in Stavenger, Norway. The theme for the ONS conference, organizers said, is change.
Maria van der Hoeven, executive director of the International Energy Agency, said the glut of natural gas from North American shale is changing the dynamics of a global energy sector where demand centers are pivoting toward Asian economies………………………………………..Full Article: Source

India’s Appetite for Gold Improves

Posted on 27 August 2014 by VRS  |  Email |Print

As gold prices linger near a two-month low, demand in Asia has started edging higher with buyers in India increasing purchases ahead of a Hindu religious festival this week. The mark up to global gold prices, known as a premium, that Indian consumers pay has climbed to $10 to $13 a troy ounce from zero in July, a sign that appetite for gold is picking up in the world’s second-largest consumer of the precious metal.
The vast majority of India’s gold supply comes from abroad. As a result, Indian gold buyers typically pay a premium to global prices that reflects the tightness of locally available supply as well as the government-imposed import duty………………………………………..Full Article: Source

Is Asian gold demand really slipping so much?

Posted on 27 August 2014 by VRS  |  Email |Print

By all accounts in the mainstream media, gold demand in Asia, and in particular in China and India, has been slipping dramatically this year which some see as the principal reason behind current price weakness. But all may not be as the reports suggest. Is Chinese demand, as suggested by the enormous slippage in gold imports though Hong Kong really as bad as the figures appear to show?
Reuters reports Hong Kong net gold exports to mainland China in July as falling to the lowest level since June 2011 at 22 tonnes (Bloomberg reports the figure as 21 tonnes). Compare this with the heady days last year when such gold imports exceeded 100 tonnes monthly for 6 months in a row from May to October………………………………………..Full Article: Source

Fund Managers Cut Most Precious Metals Positions In Latest CFTC Data

Posted on 27 August 2014 by VRS  |  Email |Print

Large speculators cut their net-long gold futures and options holdings on the Comex division of the New York Mercantile Exchange in the latest Commodity Futures Trading Commission data for the week ended Aug. 19, reversing some of the gains established in the last report.
The retreat came as geopolitical fears subsided and pushed the yellow metal under $1,300 an ounce during that timeframe. Platinum group metals activity was mixed, with large speculators adding to bullish palladium holdings and dropping platinum. These traders continued to trim net-long silver positions and cut their exposure in copper , too………………………………………..Full Article: Source

Commodities Rally Is Half-Baked

Posted on 26 August 2014 by VRS  |  Email |Print

It all started so well: a surprise drop in Treasury yields, expectations of accelerating economic recovery, and more than a dash of geopolitical turmoil. Yes, 2014 was shaping up to be a good year for commodities. And indeed, the first half was more than acceptable. At 7.1%, the recently renamed Bloomberg Commodity Index (formerly the Dow Jones- UBS index) had its best six-month period since the latter half of 2010 and its best first half since that of 2008, when the supercycle’s ascent seemed unstoppable.
Fast forward all of eight weeks and the good times are over. Commodities as a whole are now in negative territory for the year. Their lead over the S&P 500 has flipped to an 8.5 percentage point disadvantage. And while August may traditionally be a month of thin trading, there is good reason to think summer will set the tone for the rest of the year………………………………………..Full Article: Source

Commodities Attractive As Stocks Smash Highs

Posted on 26 August 2014 by VRS  |  Email |Print

Most financial advisors suggest that their clients diversify across asset classes, with only the percentages of stocks, bonds, gold and other assets as a matter for debate. I won’t wade into the latter discussion, but the charts suggest that commodities as an asset class may be ready to play a greater role.
The Thomson Reuters CRB index, also known as the CCI index, may have found a bottom. As the Standard & Poor’s 500 reached the 2000 milestone Monday, investors should consider that commodities could be the next opportunity………………………………………..Full Article: Source

IEA Chief Says Europe Must Rely on Russian Gas

Posted on 26 August 2014 by VRS  |  Email |Print

Europe has limited options for finding natural-gas supplies from outside of Russia despite tensions over Ukraine, the International Energy Agency’s chief executive, Maria van der Hoeven, said on Monday. “In the short term, Europe has very, very little means to diversify its gas imports,” Ms. van der Hoeven said on the sidelines of the Offshore Northern Seas energy conference. “As far as we can see, Russian gas will be needed in Europe.”
About a third of Europe’s gas supply comes from Russia and a fifth is supplied by Norway, while other key sources include imported liquefied natural gas and producers like the Netherlands and the U.K., Ms. van der Hoeven said………………………………………..Full Article: Source

Low Oil Prices Could Crush Russian Economy

Posted on 26 August 2014 by VRS  |  Email |Print

Oil remained under pressure from plentiful supplies and October Brent crude eased 18 cents to $102.11 a barrel. WTI crude lost 18 cents to $93.47 a barrel. As tensions around the globe continue to escalate oil supplies remain higher than expected.
Federal Reserve Chair Janet Yellen on Friday nodded to the concerns of some Fed officials about the sustained level of monetary policy stimulus, even as she stressed the need to move cautiously on raising rates. In a stronger language than he has used in the past, ECB President Mario Draghi on Friday stressed the central bank is prepared to respond with all its “available” tools should inflation drop further………………………………………..Full Article: Source

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