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Commodity Markets Entering Period of Stability

Posted on 24 June 2016 by VRS  |  Email |Print

Orica Ltd., the largest supplier of explosives to the mining industry, has begun to observe stability in commodity markets that have been marked by volatility, sinking profits and job cuts after a global boom ended.
“We still see a lot of volatility, but I think that I’ve seen more stability than I’ve seen in some time,” in the past month, Chief Executive Officer Alberto Calderon said. “When I talk to our customers I get the sense they are saying ‘Well let’s get on with it’………………………………………..Full Article: Source

Is there really a commodity revival?

Posted on 24 June 2016 by VRS  |  Email |Print

Following multiple years of calamitous returns the tide appears to be showing some signs of turning for commodities, with some even calling the end of the sector’s prolonged bear market. Last year witnessed the MSCI World Energy index nosedive 18 per cent. But since the start of 2016 to June 10, the measure has jumped by 16 per cent, according to data from FE Analytics.
Of course, all eyes have been on the oil price, which after crashing below $28 a barrel earlier this year topped the $50 mark in late May. But gold too, bolstered by its safe-haven status, has enjoyed a strong year-to-date run with the price of bullion up 21 per cent………………………………………..Full Article: Source

Saudi Arabia Declares Cease-Fire in Oil War

Posted on 24 June 2016 by VRS  |  Email |Print

The new Saudi oil minister, Khalid Al-Falih, says the oil glut is over. That means the kingdom’s war against U.S. shale producers is coming to an end, too. Who won it is a tough question to answer; on balance, it’s probably the Saudis, but they have paid a huge price, and the surviving U.S. frackers have also benefited.
In September 2014, Saudi Aramco, the kingdom’s state oil company, simultaneously increased output and discounts to Asian customers, making it difficult for producers with higher costs to compete. The U.S. shale industry responded with desperate bravado, cutting costs, perfecting technologies and pumping like crazy to avoid defaulting on its debts………………………………………..Full Article: Source

Gold settles lower for fifth day ahead of Brexit result

Posted on 24 June 2016 by VRS  |  Email |Print

Gold futures settled with their fifth-straight session loss Thursday, holding ground at two-week lows, as major global stock markets gained ahead of a historic decision on the U.K.’s membership in the European Union. Gold for August delivery declined $6.90, or 0.5%, to $1,263.10 an ounce. Over the past five days, gold has declined 2.7%. The SPDR Gold Trust ETF was down 0.4% on Thursday.
Although referendum polls remained tight, the Ipsos Mori poll for the Evening Standard newspaper, showed 52% of U.K. respondents in the “remain” camp compared with 48% backing the “leave” side. European stocks and the pound extended gains after the poll. Ipsos Mori’s June 16 survey had the “leave” side ahead………………………………………..Full Article: Source

Copper Is Just a Bystander in Commodities’ Best Start Since 2008

Posted on 24 June 2016 by VRS  |  Email |Print

The best start to a year for commodities since 2008 is leaving copper in the dust. The metal is one of the weakest of the 22 raw materials in the Bloomberg Commodity Index of returns this year and the worst of the major metals.
“If you look at where iron ore, coking coal or oil have gone this year, copper really has lagged,” Tyler Broda, an analyst at RBC Capital Markets in London, said by phone. “There is no question that right now copper is relatively tenuous in terms of the outlook. We’re definitely picking up a more neutral near-term outlook on copper than previously.”……………………………………….Full Article: Source

Here’s how ‘Brexit’ will impact commodities

Posted on 23 June 2016 by VRS  |  Email |Print

Britons will vote on Thursday (Today) on whether to remain in the European Union. Market volatility is expected to be particularly severe if the result is an unprecedented ‘Brexit’. Two opinion polls released on Monday suggested support for Britain staying in the 28-nation bloc had recovered some ground following the murder of a pro-EU lawmaker last week, although a third survey found backers for Brexit ahead by a whisker.
Betfair betting odds have also shown Britain’s ‘remain’ option gaining traction, with the implied probability of such an outcome at 78 per centon Monday, up from 60-67 per centon Friday. Here is a look at what analysts at several banks feel a Brexit vote could do to the broad commodities sphere………………………………………..Full Article: Source

How a Brexit Would Impact the Commodities Market (Video)

Posted on 23 June 2016 by VRS  |  Email |Print

Mark Keenan, Societe Generale managing director and head of commodity research - Asia, explains how a Brexit would impact commodities. He speaks with Bloomberg’s Rishaad Salamat on “Trending Business.”.………………………………………Full Article: Source

Oil analysts agree price will rise, but disagree on magic number

Posted on 23 June 2016 by VRS  |  Email |Print

Just months after asking, “How low can it go?” oil analysts are raising price forecasts for 2017 and beyond. But they differ on how high it will go, and when. Many firms see a gradual increase toward $80 a barrel in the coming years, but one believes the oil cycle will peak next year.
On Monday, Raymond James increased its already bullish forecast, calling for U.S. crude at $80 a barrel in 2017, up $5 from its previous forecast. Thereafter, it believes oil will fall to $75 in 2018 and $70 in 2019………………………………………..Full Article: Source

Commodities prices could remain low for the next decade

Posted on 22 June 2016 by VRS  |  Email |Print

A glut in a number of commodities could see prices stay at these levels for the next 10 years – that’s according to BHP Billiton Limited CEO Andrew Mackenzie. Mackenzie says the supply of crude oil and copper would decline naturally, but the huge investments by miners around the world since 2008 in other bulk commodities like iron ore, could see the effects of oversupply last for years.
“The reality is we’ve settled down now to a price that we would say is more realistic on the basis of fundamentals of supply and demand. We’ve had such a long boom. To walk that through in my view may take another 10 years,” he said………………………………………..Full Article: Source

The commodity rebound has legs

Posted on 22 June 2016 by VRS  |  Email |Print

The price rebound in oil prices this year has provided plenty of merriment for energy investors. Oil prices have gained about 30% this year and both West Texas Intermediate, the U.S. benchmark, and Brent crude, the global benchmark, traded above $50 in early June.
Yet, the commodity rebound is far deeper than just oil. Prices for coffee, corn, orange juice, gold and silver are up more than double digits so far this year, according to an analysis by Bespoke Investment Group………………………………………..Full Article: Source

Milder La Niña forecast for commodity markets

Posted on 22 June 2016 by VRS  |  Email |Print

The La Niña weather phenomenon forecast to develop later this year will not be as strong as that of 2010-12 when severe droughts in key growing areas around the world devastated crops. “Climate models suggest it is unlikely to reach levels seen in the most recent event of 2010-12, which was one of the strongest La Niña events on record,” said the Australian Bureau of Meteorology in its latest analysis on Tuesday.
La Niña, which is the opposite of El Niño, is caused by the cooling of the tropical Pacific Ocean. The weather event normally brings dryness in the US midwest and rainfall in Southeast Asia and Australia………………………………………..Full Article: Source

The yellow metal is all aglitter

Posted on 22 June 2016 by VRS  |  Email |Print

After falling six per cent in May, gold prices have gained momentum in June, recovering from the low of $1,199.60 per ounce on May 30 to $1,286 at present, rising around 7 per cent.
The recent rally is a combination of two key events that dominated the price trajectory of the yellow metal. The prime driver was the US Federal Reserve meeting, which was scheduled on June 14-15; the other event is the Brexit referendum on June 23………………………………………..Full Article: Source

Gold prices could rise almost 10% on Brexit

Posted on 22 June 2016 by VRS  |  Email |Print

Gold prices could swing both ways, depending on whether Britain votes to leave or remain with the European Union (EU). With fears of Britain’s exit (Brexit) receding in the past few days, gold prices have fallen and stock markets have rallied. However, should Brexit happen, gold prices could hit as high as $1,400 per ounce from Tuesday’s $1,283, according to an analyst.
“While it (Brexit) may also support the dollar thereby creating some headwind giving the negative correlation we see an increased risk that gold could be propelled towards $1400, the 2014 high,” the Khaleej Times quoted Ole Hansen, head of Commodity Strategy at Saxo Bank, as saying………………………………………..Full Article: Source

HSBC: Gold May React ‘Vigorously’ To Polls Ahead Of U.K. Referendum

Posted on 22 June 2016 by VRS  |  Email |Print

Gold may respond “vigorously” this week to any perceived changes in how U.K. citizens may vote Thursday in a referendum on whether to leave the European Union, says HSBC. The metal rose last week on polls showing the “leave” camp was ahead, but has given up some ground now with more recent polls showing the “remain” camp just might win after all.
Polls remain tight, however. “The U.K. referendum presently appears the most influential factor in the gold market and as opinion polls shift and investor perceptions of the likely referendum outcome change, even slightly, we expect the gold market to respond, possibly vigorously,” HSBC says. ……………………………………….Full Article: Source

Soft Commodities: The Quiet Bull Market

Posted on 21 June 2016 by VRS  |  Email |Print

Sugar is sweet. Coffee is percolating. Orange juice explodes. Cocoa is a long-term bull. Cotton is cheap. Gold and oil get lots of headlines. Recently, we have heard a lot about rallies in soybeans and corn and other commodities. However, rarely do the soft, or luxury goods, get much press, but they have been active over recent months.
In fact, way back in August of 2015, one sweet staple was the first commodity to move higher from multi-year lows. Few took note of the rally, but that agricultural product has almost doubled since then, and it is a staple that most of us consume each day………………………………………..Full Article: Source

With oil price near $50, resilient U.S. shale producers eye new chapter

Posted on 21 June 2016 by VRS  |  Email |Print

Two years into the worst oil price rout in a generation, large and mid-sized U.S. independent producers are surviving and eyeing growth again as oil nears $50 a barrel, confounding OPEC and Saudi Arabia with their resiliency.
That shale giants Hess Corp, Apache Corp and more than 25 other companies have beaten back OPEC’s attempt to sideline them would have been unthinkable just months ago, when oil plumbed $26 a barrel and collapses were feared. To regain market share, the Organization of the Petroleum Exporting Countries in late 2014 pumped more oil despite growing global oversupply………………………………………..Full Article: Source

Oil prices push back above $50 a barrel as traders bet on Remain

Posted on 21 June 2016 by VRS  |  Email |Print

Oil prices pushed back above the $50 a barrel mark this morning after the US dollar fell against the pound in line with speculation that Britain will remain a member of the European Union when it votes later this week. The market price for Brent crude on Friday was slightly above $49 a barrel but on Monday the market opened at $49.50 and quickly climbed to above $50 by mid morning.
The price of crude oil broke through the $50 mark for the first time this year a month ago, but fell back last week as market confidence slumped amid growing uncertainty over Brexit………………………………………..Full Article: Source

Is China the de facto, unwitting OPEC for metals?

Posted on 21 June 2016 by VRS  |  Email |Print

Is China doing for metals markets what Saudi Arabia used to do for crude oil? The world’s largest producer and consumer of industrial metals may be acting as a de facto, if unwitting, type of OPEC for metals, adjusting supply in response to price signals and balancing the market.
While not as obvious as the role Saudi Arabia played as the market balancer for crude in the previous glory days of the Organization of the Petroleum Exporting Countries (OPEC), the dynamics for China and metals may be somewhat similar………………………………………..Full Article: Source

In the Saudi-Iran Oil Clash, Riyadh Gains an Edge

Posted on 20 June 2016 by VRS  |  Email |Print

Saudi Arabia is poised to boost its share of OPEC oil production in the coming months, as Iran’s rapid recovery runs out of steam and the kingdom raises output as summer temperatures soar.OPEC’s biggest exporter has seen its share of the group’s production chipped away despite its landmark decision in November 2014 to no longer support crude prices by holding back supply.
The strategic shift was driven by a desire to protect its own market share, but that’s been restrained by rising production from Iraq, Indonesia’s return to OPEC and the easing of sanctions on Iran………………………………………..Full Article: Source

Nobody wants to wear the oil crown that makes OPEC richer

Posted on 20 June 2016 by VRS  |  Email |Print

The world’s biggest oil importer. The title nobody wants. For decades the U.S. held undisputed rights to the crown. Last year, China squeaked ahead for the first time amid growing demand and as rising U.S. shale production displaced overseas deliveries. The Middle Kingdom looked poised to become the center of the crude importing world.
Then $30 oil happened. U.S. drillers shut the most rigs in modern history, production began to fall and imports have rebounded. Chinese oil firms also shuttered output and kept demand growing. Now the two are neck and neck………………………………………..Full Article: Source

Safe haven demand adds sheen to gold

Posted on 20 June 2016 by VRS  |  Email |Print

Gold continues to remain on a strong footing. The “Brexit” fear in the market is helping the yellow metal regain its safe haven status. Bullion prices surged for the third consecutive week. The global spot gold price rose 1.9 per cent last week to close at $1,298.65 per ounce.
Gold prices have skyrocketed 7 per cent over the last three weeks. Gold broke above the psychological $1,300 mark last week to make an intraweek high of $1,315. But prices reversed lower on Thursday after the campaigning in the UK for the referendum was stopped following the murder of Labour MP, Jo Cox. However, gold bounced back once again from the low of $1,276 on Friday to close just below $1,300………………………………………..Full Article: Source

Uncertainties of Brexit making gold attractive as safe asset

Posted on 20 June 2016 by VRS  |  Email |Print

The outcome of Thursday’s Brexit referendum will chart the price of gold in the next six to 12 months, but, in the longer term, investors and analysts agree that bullion is an asset to hold. The immediate trigger for any gold price moves will come in the wake of the referendum, which could see Britain leave the European Union.
Robin Tsui, exchange traded fund (ETF) gold specialist of Asia-Pacific at State Street Global Advisors, said: “If Britain does decide to vote for an exit, this would trigger more uncertainties. There are also risks that other countries may follow Britain to vote for an exit………………………………………..Full Article: Source

Silver Sleeping On the Job

Posted on 20 June 2016 by VRS  |  Email |Print

In the time of the ancient Babylonians - long before the periodic table - there were seven sacred metals: gold, silver, copper, iron, tin, lead and mercury. In Roman and Greek Mythology, the First Age was called Golden, the Second Age Silver. Apollo, the god of truth and light, and teacher of medicine, carried a silver bow.
The hieroglyph of Isis (Egyptian moon goddess) is a crescent and images of her are usually reproduced with her standing on the Crescent. This has also become the symbol for silver – on old maps a crescent shows the location of a silver mine………………………………………..Full Article: Source

Options market maps zinc bulls’ upside ambitions: Andy Home

Posted on 20 June 2016 by VRS  |  Email |Print

Zinc continues to shine amid the general gloom pervading the base metals complex. On the London Metal Exchange (LME) benchmark three-month zinc has eased back from the near one-year high of $2,105.50 per tonne hit earlier this month.
But at a current $1,983, zinc is still showing year-to-date gains of over 26 percent, by some margin the best performance of the base metals pack. Investors have been drawn into the market by an enticing narrative of closing mines and a tightening raw materials supply chain………………………………………..Full Article: Source

Commodities stage broad retreat on economic worries

Posted on 17 June 2016 by VRS  |  Email |Print

Oil, copper and grains slide as Federal Reserve’s caution adds to anxiety over growth. Global economic growth fears gripped commodity investors on Thursday, depressing oil, industrial metals and grain markets.
Commodity bulls retreated after the US Federal Reserve’s decision to leave interest rates unchanged raised worries about the strength of the economy. Jitters about Brexit also fed into worries about demand for raw materials………………………………………..Full Article: Source

Global Oil Market to Reach Supply-Demand Balance by End of 2016

Posted on 17 June 2016 by VRS  |  Email |Print

The global oil market will reach the balance of supply and demand by the end of the year, BP Head Bob Dudley said. “We continue to think that before the end of 2016 on a daily basis supply and demand we think will balance. There is still a lot in storage around the world. But we do think that the fundamental point will likely happen before the end of the year,” Dudley said.
“I think we drifted down a little bit in the last month, and there is also the uncertainty of geopolitical issues. But i think we can see prices above $50 a barrel by the end of the year. We are working really hard to readjust our cost structures to be able to operate and balance our sources of funds at $50 dollars per barrel. I think by next year we will get there,” he added………………………………………..Full Article: Source

Global Oil Market to Reach Equilibrium By Mid-2017

Posted on 17 June 2016 by VRS  |  Email |Print

Oil prices are likely to reach $65 per barrel within three or four years, before the next cycle of high oil prices possibly taking prices to $150 per barrel within 10-15 years, he said. “Keeping production and supply at the given level, the imbalance can be reduced by rising consumption, and it will fall by the start of 2017…Supply and demand will be in equilibrium in the middle of next year,” Novak said.
“There is a certain consensus that but the end of the year, the price will be at the level of $50-60 per barrel this year, with the average yearly price just below $50 per barrel given that prices were low at the start of the year,” the minister added………………………………………..Full Article: Source

Commodities making a comeback as best performing asset class

Posted on 16 June 2016 by VRS  |  Email |Print

Commodities have performed strongly so far this year, returning 14.0%, outperforming Bonds at 6.6% and Equities at 0.5%. Nitesh Shah, Director – Commodities Strategist, ETF Securities, identifies an improved outlook for global growth, and signs of a commodity supply deficit, as key stimulants of the comeback.
“Sustained central bank interest in keeping interest rates low in an effort to stimulate the economy is providing further support for commodities. And investor sentiment has come off near decade lows as investor realise that commodity oversupply is ending in many areas.”……………………………………….Full Article: Source

China’s Investors Shifting to Global Commodities

Posted on 16 June 2016 by VRS  |  Email |Print

China’s cash-rich investors are increasingly looking to trade on offshore commodities markets after a regulatory crackdown and amid fears over the depreciation of the yuan, according to Marex Spectron Group.
“We’re definitely seeing a tumultuous rise in retail-type or investor-type trading,” Simon van den Born, the broker’s global head of metals, said Wednesday at a press briefing in Hong Kong. Revenues from China have doubled this year, offsetting a slump of about 30 percent in traditional business from industrial and corporate clients, he said………………………………………..Full Article: Source

Latin American Markets Tumble with Commodities

Posted on 16 June 2016 by VRS  |  Email |Print

Depressed Latin American markets took cues from lower commodity prices on June 10. Investors were trading cautiously as losses were seen in commodity and crude-related indexes. The Brazilian BM&F Bovespa SA and the Mexican IPC index fell 3.3% and 1.1%, respectively.
The decline in global crude prices and other essential commodities caused the Colombian COLCAP index to trade 0.97% lower. Colombia highly depends on crude prices, as prices directly affect the country’s export revenues. Among the Latin American indexes, the Argentinian Merval Index fell 1.5% while the Chilean IPSA Select Index was trading 0.54% lower………………………………………..Full Article: Source

Oil could shed more than half its value to $20, analyst says

Posted on 16 June 2016 by VRS  |  Email |Print

Oil futures have staged a magnificent comeback in recent months. However, if history is any guide, the struggling market isn’t out of the woods. Looking at the performance of West Texas Intermediate crude oil since 1870, Paul Jackson, head of research at exchange-traded-fund provider Source, predicted that prices will tank to $20 a barrel, or about 60% from its current levels, and languish for a while, before recovering.
“What you find is that in four out of every five months since 1870 the price has been between $20 and $60, when you measure in today’s prices,” he said……………………………………….Full Article: Source

Oil and gas industry to cut $1 trillion in spending after price slump

Posted on 16 June 2016 by VRS  |  Email |Print

The oil and gas industry will cut US$1 trillion from planned spending on exploration and development because of the slump in prices, leading to slower growth in production, according to consultant Wood Mackenzie.
Worldwide investment in the development of oil and gas resources from 2015 to 2020 will be 22 per cent, or $740 billion, lower than anticipated before prices plunged in 2014, with the deepest cuts in the US, Wood Mackenzie said in a report Wednesday. A further $300bn will be eliminated from exploration spending. Global production this year will be 3 per cent lower than previously forecast, the consultant said………………………………………..Full Article: Source

OPEC Turmoil Could Turn IEA’s Balanced Market Into Shortfall

Posted on 16 June 2016 by VRS  |  Email |Print

The world’s most prominent oil forecaster, the International Energy Agency, anticipates near-equilibrium between supply and demand in global crude markets next year. If OPEC members can’t resolve some massive output disruptions, that will turn into a significant shortfall.
World oil production in 2017 will very nearly match consumption, ending several years of oversupply, the Paris-based IEA forecast on June 14. For that to happen, the Organization of Petroleum Exporting Countries would have to pump an extra 650,000 barrels a day over the year, according to Bloomberg calculations based on IEA data………………………………………..Full Article: Source

Commodity maket rally ’still in early stages’

Posted on 15 June 2016 by VRS  |  Email |Print

The commodities rally is still in its early stages, leading commentator David Hightower told the Agrimoney Investment Forum, flagging the growing demand for ags from emerging market countries. “We are much closer to the bottom for commodity prices than to a high,” Mr Hightower, founder of the influential Chicago-based Hightower Report said.
“If you think you have missed the commodities move – think again.” He highlighted that even now - after commodities prices have risen by 12.3% this year, as measured by the Bcom index – they remain well below historic highs………………………………………..Full Article: Source

Demand for dry bulk commodities

Posted on 15 June 2016 by VRS  |  Email |Print

When it comes to the dry bulk market, shipowners these days are looking for news in any shape or form they can find them. However, as the discussion over the market’s future prospects is being dominated by the obvious tonnage oversupply, things could very well start to show modest signs of improvement in the demand-side of the market as well.
Dry bulk ship owner Golden Ocean said in its latest quarterly report that “China’s official GDP growth slowed to 6.7 per cent in the first quarter of 2016. In the new five year plan announced in China in March the target for annual GDP growth during the next five years was set to 6.5 per cent………………………………………..Full Article: Source

Global Oil Markets Approach Balance, IEA Says

Posted on 15 June 2016 by VRS  |  Email |Print

Global oil markets are moving close to balance in the second half of this year on stronger-than-expected demand and on supply disruptions, the International Energy Agency said. Summer Said reports the oversupply in the first half of this year is likely to stand around 800,000 barrels a day, down from the 1.5 million barrels initially anticipated.
Global oil demand in the first quarter of this year was revised up to 1.6 million barrels a day. Unplanned shut-ins in Canada and Nigeria as well as the expected drop of 900,000 barrels a day in production from producers outside the Organization of the Petroleum Exporting Countries, or OPEC, will help the markets to rebalance, the oil watchdog said………………………………………..Full Article: Source

Is Gold-to-Silver Ratio Too High?

Posted on 15 June 2016 by VRS  |  Email |Print

The gold-to-silver-ratio is an indicator that shows how many silver ounces are required to purchase an ounce of gold. The gold-to-silver ratio is one of the most important parameters in the precious metals market, as it measures the relative value of gold and silver. Therefore, it is a useful tool indicating whether gold or silver is undervalued or overvalued relative to each other.
Investors can use the ratio as a timing indicator deciding when to buy gold or silver, or which metal to buy at any given time. When the ratio is low, it means that silver is overvalued relative to gold (and vice versa)………………………………………..Full Article: Source

Opec: Oil market to reach balance by end of year

Posted on 14 June 2016 by VRS  |  Email |Print

The oversupplied oil market is on track to rebalance later this year as economic growth spurs demand against a backdrop of falling US production and a string of supply outages. The Organization of Petroleum Exporting Countries (Opec) said in its latest monthly report that commercial crude stocks declined by eight million barrels in May.
By contrast, global stocks increased by 12 million barrels in March and April, and by 19 million barrels in February. The chronic glut of oil forced market prices to their lowest point in 12 years in January, but as the excess supply dwindles, prices have rallied higher. Opec’s reference price for May averaged $43.21 a barrel, a gain of $5.35 compared to the previous month………………………………………..Full Article: Source

Kenya ripe for commodity exchange market, experts say

Posted on 14 June 2016 by VRS  |  Email |Print

Speaking ahead of a Commodity Trading and Risk Management Seminar that gets underway today, Kenya National Chamber of Commerce and Industry CEO Matanda Wabuyele said such a market would save farmers from low prices offered by speculative middlemen.
“It will be a platform where buyers and sellers meet with certain rules and conditions to ensure that people are able to sell their commodities in a transparent way and hedging against price volatility,” said Wabuyele. A commodity market trades in primary economic sectors such as agricultural products and minerals as opposed to manufactured products. In the region, Ethiopia and Rwanda have such markets………………………………………..Full Article: Source

Oil market will find balance amid the turmoil

Posted on 13 June 2016 by VRS  |  Email |Print

There is a lot of disruption going on in oil. We’re talking wildfires and war. The US Energy Information Administration (EIA) calculates that unplanned supply outages, such as those in Canada and Nigeria, reached just over 3.6 million barrels a day last month, the highest since the EIA started tracking them in 2011.
No wonder oil is back above US$50 a barrel. Or, from another perspective, how the hell is oil only at US$50? Oil looks pretty subdued relative to earlier periods of strife, a recent report said. But then, you’d probably be a bit subdued too if you had a few hundred million barrels of oil dumped on top of you………………………………………..Full Article: Source

Gold: It’s Not Just A Fed Trade

Posted on 13 June 2016 by VRS  |  Email |Print

In recent months, the short-term trading crowd has hijacked the gold market. Momentum traders and opportunistic day and swing traders have driven the price of gold higher and lower, on shifting whims and expectations regarding when the Federal Reserve might hike rates next.
Sure, monetary policy is one factor that impacts gold, but long-term gold investors need to remember that the yellow metal is much more than just a Fed trade. Here are 7 reasons why investors like gold: Gold is a wealth preservation and wealth building vehicle. Gold is a “hard” currency that can’t be debased or devalued by a government printing press………………………………………..Full Article: Source

Copper price big loser as other commodities rally

Posted on 13 June 2016 by VRS  |  Email |Print

Amid broad advance in metals and energy, copper price sinks to lowest in four months – is China and world economy worse off than is currently believed? Copper’s weakness comes despite Chinese trade data released earlier this week showing 2016 imports of refined copper are up 22% compared to the first five months last year.
The increase in copper concentrate imports is even more dramatic with Chinese smelters taking up 34% more at 6.7 million tonnes so far this year. Copper is the second worst performing metal this year behind lead and is down more than 12% since end April………………………………………..Full Article: Source

Risk Appetite Deserts Wall Street As Commodity Rally Stalls

Posted on 10 June 2016 by VRS  |  Email |Print

Wall Street stocks look set to start Thursday’s session lower, as risk appetite is waning in the global markets. Asian stocks set the tone for the day, with the major averages in the region succumbing to selling pressure despite data showing inflation slowing in China. However, the central of New Zealand stood pat and Japanese machinery data was weak.
The European markets are also lower amid retreating commodity prices. The markets did not go overboard over positive German export data. The domestic markets may also keep an eye on the jobless claims data due ahead of the market open. As of 6:30 am ET, the Dow futures are down 52 points , the S&P 500 futures are slipping 8 points and the Nasdaq 100 futures are receding 8 points………………………………………..Full Article: Source

Oil market getting used to looking up, not down

Posted on 10 June 2016 by VRS  |  Email |Print

Saudi Arabia’s new energy minister Khalid Al Falih is in a quandary. On the one hand, still bloated global oil inventories that drove this year’s prices to lows last seen in 2003 concern him. At the same time, the slashing of hundreds and billions of dollars of investment in future projects by the world’s biggest energy companies might be storing up problems.
After dropping below $30 per barrel in January, the price of Brent crude has risen to more than $50, suggesting that not only has the market bottomed, but a sustained recovery is under way after a protracted fall that started almost two years ago………………………………………..Full Article: Source

Are Low Crude Oil Prices Finally Hurting Saudi Arabia?

Posted on 10 June 2016 by VRS  |  Email |Print

Saudi Arabia held about 267 billion barrels of proven oil reserves at the end of 2014, which is the second largest oil reserves held by a single country. The founder member of the Organization of Petroleum Exporting Countries accounts for roughly 10% of the global oil production and plays a crucial role in the determination of crude oil prices.
The Middle East country also contributes a notable portion of the global oil exports and has a sizeable amount of spare capacity, which it can use to maneuver the dynamics of the oil markets. Thus, the country is being viewed as a game changer in the ongoing oil slump………………………………………..Full Article: Source

Statoil Expects Tighter Oil Market

Posted on 10 June 2016 by VRS  |  Email |Print

Norway’s Statoil ASA said Thursday that it expected the oil market to tighten in the next couple of years, which may cause price spikes, adding that significant investment is needed to offset falling output from existing fields even if oil demand will be lower.
“There is a lot of oil in storage, but within two to three years markets will be tightening significantly,” said Statoil’s chief economist Eirik Waerness. “The question is whether the pace of investment is sufficient to deliver the new [oil] supply that is needed. You can’t rule out that you’ll get a price spike.”……………………………………….Full Article: Source

US Worried OPEC Overproduction Could Lead to ‘Regime Change’ in Venezuela

Posted on 10 June 2016 by VRS  |  Email |Print

The decision by the Organization of Petroleum Exporting Countries (OPEC) to drive production while oil prices fell could ultimately lead to an overthrow of the government of cartel member Venezuela, US Congressman Jeff Duncan told Sputnik on Thursday.
“I think ten years from now, we’ll look back at this as a positive effect, possibly on regime change in Venezuela,” Duncan said of OPEC’s increased supply of oil to the global markets………………………………………..Full Article: Source

New Commodity Super Cycle?

Posted on 09 June 2016 by VRS  |  Email |Print

Barring a large selloff, or economic recession, the evidence suggests we are in the early stages of a new bull market for commodities. Over the past few years, nearly every major global commodity in the world has been in a severe bear market. Gold and Silver both topped out in late 2011 and were in a vicious downtrend/bear market until Q4 2015.
Now, in mid-2016, Gold and Silver are two of the strongest performing asset classes of the year. Other commodities are also emerging from violent bear markets such as: Oil, Soybeans, Wheat, Corn, Sugar, Coffee, just to name a few………………………………………..Full Article: Source

Oil market is back in balance: Kemp

Posted on 09 June 2016 by VRS  |  Email |Print

Global oil markets seem to have moved back into balance thanks to strong growth in fuel consumption and a series of large supply disruptions in major crude producing nations. Motorists’ soaring consumption of cheap gasoline in the United States as well as in some large emerging economies, including India and Mexico, will help boost global oil demand by more than 1.4 million barrels per day in 2016.
Consumption had already risen by 1.8 million bpd in 2015 and is predicted to increase by well over 1.0 million bpd again next year, marking the strongest and most sustained increase in demand since before the financial crisis………………………………………..Full Article: Source

Oil Closes Above $50 for Second Day in a Row

Posted on 09 June 2016 by VRS  |  Email |Print

First back-to-back settlements above that mark in nearly a year amid production outages. U.S. oil prices rose to a fresh 10-month high Wednesday as traders stayed focused on production outages that could significantly curb the amount of excess global supply by year’s end.
The benchmark price closed above $50 a barrel for the second session in a row, marking the first back-to-back settlements above that point in nearly a year. Crude oil has nearly doubled in value since hitting decade lows earlier this winter as production disruptions world-wide rein in the oversupply that had spurred two years of falling prices………………………………………..Full Article: Source

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