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Commodities Briefing - Category | Price Watch more

Gold price set to rise to US$1,300 by year-end

Posted on 16 June 2015 by VRS  |  Email |Print

The price of gold is expected to rise to US$1,300 per ounce by year-end from the current US$1,170, says manager of GFMS Precious Metals Demand Asia, Cameron Alexander. He said the price had been range-bound for sometime now and would see a downside in the short time, ranging between US$1,125-US$1,130 per ounce.
“But towards the second half of the year, there is a possibility of the price moving higher,” he said. Alexander said the price upside for the yellow metal would be driven by debate over Greece’s debt position and political turmoil in Eastern Europe………………………………………..Full Article: Source

Commodity prices rebounded?

Posted on 15 June 2015 by VRS  |  Email |Print

Bloomberg commodity Index is slightly gaining its value in last three month. However, its returned still decline by 24.89% on year on year basis. Bloomberg Commodity Index is calculated on the basis of an excess return and reflects twenty commodity exchange traded futures price movements, including energies, Industrial metals, precious metals, grains, soft commodities and livestock.
Demand for global commodity markets slumped in last one year due to booming in global equity markets. Investors reduced their interest in commodity to markets. Index slid mainly due to tumbled in crude prices as lower demand in the market against higher supplies. Dollar-denominated commodities such as gold, crude and copper prices tend to decline when dollar gains, as this makes it costlier for buyers for other currencies………………………………………..Full Article: Source

Supply cutbacks to push oil prices: QNB

Posted on 15 June 2015 by VRS  |  Email |Print

The average oil prices are expected to rise to 64.1 per barrel in 2016, from an expected 56.2 per barrel in 2015, according to a research note issued by the QNB. Oil prices have rebounded by 33.1 percent since their trough in January to 62.0 per barrel. A research conducted by QNB to find out what is behind this recovery showed that demand was ingle-handedly behind the recent recovery, but that supply was responsible for the majority of the 60 percent collapse in oil prices in the second half of 2014.
“Our conclusions about the relative roles of demand and supply are supported by independent data from the International Energy agency (IEA). This suggests that the recovery in oil prices still has legs as the adjustment through lower supply is yet to happen………………………………………..Full Article: Source

Gold prices to grow at realistic pace

Posted on 15 June 2015 by VRS  |  Email |Print

Once all the technical reasons have been set off, gold prices would reach the minimum level and from there it will start looking up once again at a more realistic pace than the present speculation driven levels, said Babu John, chairman and managing director of Sky Jewellery in an interview to Times of Oman. He was in Oman to celebrate the store’s tenth anniversary.
You have achieved a major milestone in Oman, how has the journey been? When I started in the year 2005, my first Oman operations in Muscat, it was a standalone showroom little away from the conventional gold souq. It had its own teething problems but clean strategies, extraordinary commitments of my staff helped us overcome all constraints………………………………………..Full Article: Source

Russia says oil price of $60-70 per barrel comfortable for market

Posted on 12 June 2015 by VRS  |  Email |Print

Oil prices of $60-70 per barrel are comfortable for the market, Russian Energy Minister Alexander Novak told the Russian parliament on Wednesday. “A joint consolidated view of all market participants, exporting countries, is that oil prices of $100 and higher we saw earlier will not be seen in the nearest future,” Novak said.
He added that domestic energy companies had cut investments by around 5 to 10 percent this year due to weak oil prices comparing with some 30 percent among global competitors. Russia is the largest oil producer outside OPEC. Last week, OPEC decided to maintain its production target despite weak oil prices. OPEC had earlier signaled it would be ready for a cut only if non-OPEC producers such as Russia join the move………………………………………..Full Article: Source

Gold: The US sets the price but Asia does the buying

Posted on 12 June 2015 by VRS  |  Email |Print

It seems illogical that gold price movement seems to be dominated by US internal factors while most gold trade is elsewhere. What’s driving the gold price? At the moment it seems to be a succession of knee-jerk reactions to U.S financial data which push the gold price up or down, depending on the perception as to whether the data will likely bring the US Fed’s proposed interest rate rise programme forward or move it backwards.
It really isn’t a logical situation – but where’s the logic in the precious metals markets anyway? To many, gold is a relatively underutilised metal which works well as jewellery, but nowadays has little else going for it apart from a long history of monetary usage which nowadays may have had its time. Bankers and economists discount its usefulness as such………………………………………..Full Article: Source

IMF’s “never again” experience in Greece may get worse

Posted on 11 June 2015 by VRS  |  Email |Print

For the International Monetary Fund, five years of playing junior partner in European bailouts for Greece has been a “never again” experience, and the worst may be yet to come. The global lender has lent far more to Athens than to any other borrower, contributing nearly one-third of the total 240 billion euros, with the rest coming from euro zone governments and the bloc’s rescue fund.
But it has sat uncomfortably in the side-car of the Greek rescue. Called in by EU paymaster Germany to try to keep the European institutions and the Greeks honest, the Washington-based IMF has never had control of the programme………………………………………..Full Article: Source

Oil Prices To Remain Capped In The Short Term, Despite Fewer Shale Oil Barrels

Posted on 11 June 2015 by VRS  |  Email |Print

The most recent Drilling Productivity Report from the U.S. Energy Information Administration reveals that the phased impact of lower oil prices on U.S. tight oil production growth, is finally starting to show up and is expected to increase in magnitude over the next couple of months.
The agency estimates crude oil production from the seven key regions in the Lower 48 states to have declined by around 44,000 barrels per day, or 0.8% month-on-month in May, and expects the decline rate to increase to around 91,000 barrels per day, or 1.7% month-on-month by July of this year. According to the EIA, these seven regions accounted for almost 95% of the total domestic crude oil production growth between 2011 and 2013………………………………………..Full Article: Source

Oil Prices Rise on Inventory Data

Posted on 11 June 2015 by VRS  |  Email |Print

U.S. oil prices rose to a new 2015 high Wednesday after U.S. data showed stronger-than-expected demand for crude oil and gasoline. Prices have wavered in recent weeks, pivoting around $60 a barrel as investors weighed a continued oversupply of oil against signs of stronger demand and expectations that output may be shrinking.
U.S. crude-oil stockpiles dropped by 6.8 million barrels in the week ended June 5 to 470.6 million barrels, the U.S. Energy Information Administration said Wednesday. Analysts surveyed by The Wall Street Journal had predicted a 1.8-million-barrel decrease on the week………………………………………..Full Article: Source

OPEC: No further rise in crude expected in 2015

Posted on 11 June 2015 by VRS  |  Email |Print

The Organization of the Petroleum Exporting Countries said Wednesday it sees no further rise in demand for its crude this year, but it expects the current oversupply in the market to ease over the coming quarters.
In its closely watched monthly oil market report, OPEC kept its forecast for oil demand growth in 2015 unchanged at 1.18 million barrels a day, and said expectations of demand for its own oil this year remains at 29.3 million barrels a day, or 300,000 higher than 2014………………………………………..Full Article: Source

Gold price: Reasons not to fear the Fed

Posted on 11 June 2015 by VRS  |  Email |Print

A number of gold market analysts have argued that the central factor influencing the price of gold is US interest rates. Some analysts go so far as to say that the inverted correlation is so strong that the gold price can be used as a predictor of interest rates, particularly after adjusting for inflation.
What has now almost become a rule of thumb is that rising real interest rates raises the opportunity costs of holding gold because the metal provides no yield and therefore the price should decline. Higher rates also boost the value of the dollar which usually move in the opposite direction of the gold price………………………………………..Full Article: Source

Gold Prices Hit ‘Channel Top’ at $1187 as Pimco Dumps Treasuries

Posted on 11 June 2015 by VRS  |  Email |Print

Gold prices gained almost 1.4% against a weakening US Dollar in London on Wednesday, but held flat for Euro investors as the Greek crisis entered its “final push” and government bonds sold off again worldwide.
Western stock markets rose over 1%, but Shanghai’s stock market closed the day slightly lower after global equities-index provider MSCI last night delayed adding mainland Chinese stocks to its emerging-markets benchmark, citing “a few important remaining issues” for the push-back to 2016’s review. Greek officials said they didn’t know Eurozone lenders had rejected Athens’ latest reform proposals until a press conference in Brussels today, reporting that they’d been told to re-work the plan………………………………………..Full Article: Source

OPEC oil price anchor could be easy to unmoor

Posted on 10 June 2015 by VRS  |  Email |Print

To hear OPEC ministers in Vienna last week, one would think the cartel’s battle for market share is a complete success and oil prices are now firmly anchored where they are. “The strategy is working… It will take time for markets to rebalance,” was the mantra from OPEC kingpin Saudi Arabia’s oil minister Ali al-Naimi and his peers.
However, the oil markets have probably become even less easier to read now than in November last year when OPEC launched its shock strategy of adding barrels to the already oversupplied market in the hope of winning back market share from higher-cost rivals such as U.S. shale oil………………………………………..Full Article: Source

Oil prices rise on hopes of economic stimulus from China

Posted on 10 June 2015 by VRS  |  Email |Print

Oil prices edged up on Tuesday on hopes of more economic stimulus in China after disappointing data from the world’s No.2 economy. China’s consumer inflation weakened more than expected, to 1.2 per cent year-on-year in May, raising concerns about growing deflationary pressures as the economy cools. Its producer prices fell for the 38th straight month.
“The weak data continues to point out the sluggish demand in the real economy. The government should roll out more easing measures to lower the real financing costs to boost growth,” said Yu Yafang, macro strategist at Huachuang Securities in Beijing………………………………………..Full Article: Source

Gold Prices Rise as Investors Seem Nervous

Posted on 10 June 2015 by VRS  |  Email |Print

Gold prices rose on Tuesday, as investors sought out the safe-haven metal while European stock markets slipped. Gold for August delivery, the most actively traded contract, was recently up 0.5% at $1,179.40 a troy ounce on the Comex division of the New York Mercantile Exchange.
A tumble in Germany’s DAX index led European stocks lower, as uncertainty over Greece and the timing of a U.S. interest-rate increase made investors nervous. The volatility helped boost prices for gold, an asset some investors buy during periods of uncertainty in the belief that it will perform well during turbulent times………………………………………..Full Article: Source

Gold Price Breakdown Forecast Downtrend to $1000

Posted on 10 June 2015 by VRS  |  Email |Print

Although the longer-term bullish case for gold could scarcely be stronger, over the short to medium-term the picture continues weak, with it looking vulnerable to breaking down into another downleg to the $1000 area and perhaps lower.
In the last update you may recall that there was some optimism expressed that it might perk up on the dollar topping out, but such has not proved to be the case - instead it has performed miserably and now looks set to drop more steeply to new lows. On its 8-year chart we can see that gold remains in the grip of the bearmarket in force from its bullmarket highs of 2011………………………………………..Full Article: Source

Oil Prices to Fall to the High $50 Range as OPEC Keeps Output Steady

Posted on 09 June 2015 by VRS  |  Email |Print

One expert sees downside risk to oil, now that OPEC has decided to maintain its production target of 30 million barrels a day. Jamie Webster, Senior Director for Global Oil Markets at IHS says over the next couple of months, there’s more downside risk to prices, which he believes could fall into the upper $50 a barrel range.
He said the recently drift higher in prices could re-incentivize U.S. shale producers to increase production, which would then put pressure on prices. Webster sees demand growth this year at 1.3-million barrels a day, more than double last year’s numbers, but demand isn’t strong enough to overwhelm excessive supply. He sees strong demand for oil within the United States, and ‘sizeable demand growth’ within China………………………………………..Full Article: Source

Gold to hit US$1,400 an ounce by end of 2015

Posted on 09 June 2015 by VRS  |  Email |Print

The price of gold should be boosted by official purchases from central banks and is expected to hit US1,400 an ounce by the end of this year. This is according to a note out today from Capital Economics, in which its commodities economist Simona Gambarini wrote: “We expect official purchases to be one of several factors that boost gold prices in the next year or two, despite the prospect of tighter US monetary policy and renewed strength in the dollar against other major currencies.”
Among the bullish signs she noted included the following: Most developing countries still hold less than 10% of their reserves in gold, compared to 70% or more in advanced economies………………………………………..Full Article: Source

The gold price shorts are back in town

Posted on 09 June 2015 by VRS  |  Email |Print

After a dismal week capped by Friday’s stronger than expected US jobs report that sent the gold price towards its 2015-lows, the metal took a breather on Monday. On the Comex division of the New York Mercantile Exchange, gold futures for August delivery – the most active contract – inched up $3.30 to $1,171 an ounce from Friday’s close.
Speculators on the futures market positioned themselves for last week’s weakness with large investors such as hedge funds, referred to as “managed money”, building up short positions in the week to June 2 according to the Commodity Futures Trading Commission’s weekly Commitment of Traders data………………………………………..Full Article: Source

Forget the noise: Oil prices won’t crash again

Posted on 08 June 2015 by VRS  |  Email |Print

Oil rising to $60 a barrel is displeasing some people, particularly the shorts. Some of the more extreme — those calling for oil in the $20’s – have wisely fallen silent. Others, like Goldman Sachs, who a few months ago had set their flag in the 30’s, have unfortunately not gone so silent. They recently moved their flag into the 40’s but they continue to talk a lot. A better strategy – though one that would require some humility — would be to stop talking and listen.
Recent and compounding data will soon wash away the walls of worry erected by the experts. Four consecutive weeks of inventory draws, each one larger than the last is irrefutable proof that a 60% decline in the rig count means something………………………………………..Full Article: Source

China likely to lower oil price

Posted on 08 June 2015 by VRS  |  Email |Print

China will probably cut domestic guide prices for gasoline and diesel due to drops in global crude prices. Retail prices will be reduced by over 100 yuan (around 16 U.S. dollars) per tonne, according to Xinhua’s oil price system. If confirmed, it would be the first cut since the end of March and the fourth this year.
An announcement from the National Development and Reform Commission, China’s top economic regulator, is expected Monday. According to China’s oil pricing mechanism, the price can be changed every 10 working days should there be a substantial change in the global market price………………………………………..Full Article: Source

Will Fear Drive Gold Prices Higher in June?

Posted on 08 June 2015 by VRS  |  Email |Print

As of this writing, gold for August 2015 delivery is up nearly 0.6%. This is after gold closed the month of May with a 0.4% gain. The media are throwing around different theories about where it is heading next. Many catalysts are tugging on each other and could move gold in either direction over the next month. The strengthening of the dollar certainly has served as a headwind against gold prices.
A stronger dollar means it has become more expensive for foreign investors to consume and invest in dollar-denominated items, including gold. A most notable example is China and India, which accounts for 54% of global gold demand, according to data in World Gold Council records cited by Market Realist. The high dollar relative to their currencies has dampened their enthusiasm for gold investments………………………………………..Full Article: Source

Food commodity prices fall in May to near six-year low: FAO

Posted on 05 June 2015 by VRS  |  Email |Print

The world’s major food commodity prices fell again in May to the lowest level in nearly six years amid a favourable outlook for this year’s harvests, the Food and Agriculture Organisation said Thursday. The FAO food price index averaged 166.8 points in May, down 1.4 percent from April and as much as 20.7 percent from a year earlier, the Rome-based UN agency said in a statement.
It marked the lowest level since September 2009 in the trade-weighted index that tracks prices on international markets of five major food commodity groups: cereals, meat, dairy products, vegetable oils and sugar………………………………………..Full Article: Source

Commodity prices weigh heavily on top 40 mining giants

Posted on 05 June 2015 by VRS  |  Email |Print

The tough fight faced by the global mining industry in 2014 would escalate into a brawl this year as mining companies worldwide struggled to emerge from depressed markets, PwC’s Africa Mining Centre of Excellence head Michal Kotze said on Thursday. Widespread government intervention, significant conflicts surrounding strategy debates and other internal industry conflicts, “huge” competition, weakening commodity prices with increasing short-term volatility and rising shareholder activism had left industry on the ropes.
A reduction in capital spend, somewhat higher production and “unexpected help” from currency devaluations and lower input costs had assisted the mining industry to “manage expectations” during 2014 despite continued headwinds from weak commodity prices, the latest PwC ‘Mine’ report showed. ……………………………………….Full Article: Source

The next great bull market: Gold $25,000

Posted on 05 June 2015 by VRS  |  Email |Print

Suppose someone approached you in the year 2000, when the price of gold was around $250 an ounce and suggested that it would be worth almost eight times its current value within the next decade. I am sure most people would have thought that person to be less than credible making such an outrageous market call. Think about it.
An asset being expected to multiply by eightfold within a decade? But as we all know now, gold went from $250 an ounce to just over $1,900 an ounce in just that amount of time. What if I was to tell you that gold could make another such run over the next decade plus? Does it seem that outrageous now? Well, I think the math shows it can and will, with the price of gold futures surpassing $25,000, and more specifically for this column, the price on the Gold Bug Index HUI, -1.35% eclipsing 15,000. But let’s take a look back before we go forward………………………………………..Full Article: Source

Gold’s Peak Doesn’t Mean New Price Heights

Posted on 05 June 2015 by VRS  |  Email |Print

Announcing that gold production is approaching its limits can be hazardous. In 2009 Aaron Regent, who shortly after became chief executive of Barrick Gold, said the world had reached “peak gold.” Three years later, Mr. Regent was out of a job and mined gold output was still rising. Indeed, it hit a record 3,133 metric tons last year.
Yet predictions of peak gold are again in vogue. It remains doubtful, however, that this heralds much elevation for the gold price. Gold production may be plateauing: precious metals consultancy Metals Focus expects a slight fall in output this year. A decadelong rise in the gold price from 2001 fueled indiscriminate investment but miners have slashed spending since 2013. Substantial new mines, like Barrick’s Pascua Lama in Chile, have been halted and exploration efforts scaled back………………………………………..Full Article: Source

Gold Prices Sink to Five-Week Low

Posted on 05 June 2015 by VRS  |  Email |Print

Gold prices sank to a five-week low Thursday, after the International Monetary Fund slashed its forecast for U.S. growth and warned that inflation remains elusive. Gold for August delivery, the most actively traded contract, closed down 0.8% at $1,175.20 a troy ounce on the Comex division of the New York Mercantile Exchange, its lowest price since May 1.
The International Monetary Fund on Thursday lowered its forecast for U.S. economic expansion, while urging the Federal Reserve to hold off from raising rates because prospects for inflation remained uncertain. A continued slump in consumer prices spells bad news for gold, an asset some investors buy because they believe it will hold its value during inflationary times………………………………………..Full Article: Source

OPEC moots $80 as new ‘fair’ oil price - but will it stick?

Posted on 04 June 2015 by VRS  |  Email |Print

Nearly a year after oil markets entered a deep downward spiral, unmoored from the $100-a-barrel mark that had anchored them for years, some OPEC members are publicly talking for the first time about a new “fair” price for their crude.
Oil ministers from Iraq, Venezuela and Angola said in Vienna this week that a price of $75 or $80 a barrel - barely $10 above the going rate - could be just fine. Iraq’s Adel Abdel Mahdi said it would be “equitable”. Privately, one Gulf OPEC delegate also told Reuters he reckons crude may be trading around this level next year, once markets rebalance………………………………………..Full Article: Source

BP CEO sees oil price “softness” in second half of 2015

Posted on 04 June 2015 by VRS  |  Email |Print

BP Chief Executive Bob Dudley said on Wednesday he sees “some softness” in oil prices in the second half of the year as global supplies continue to grow. “Supply growth continues to go up. We are at a balance with the supply and demand right now,” he said on the sidelines of the Organization of the Petroleum Exporting Countries ( OPEC) seminar.
“I think we can see some softness in price continuing and as a result as an industry we must readjust cost structures, tax structures around the world,” Dudley said………………………………………..Full Article: Source

Gold price: ‘Waiting worse than reality’

Posted on 04 June 2015 by VRS  |  Email |Print

Mixed economic data out of the US, a weaker dollar, Greek bailout talks on a knife edge and renewed fighting in Eastern Ukraine couldn’t lift the gold price off near one-month lows on Tuesday. After briefly topping $1,300 an ounce in January gold is now back to its 2015 opening levels of around $1,180 an ounce and down 5% over the past 12 months.
Expectations of a rate hike in the US has been a major factor behind gold’s decline as gold and bond yields have a close negative correlation………………………………………..Full Article: Source

Nickel price drops after inventories rise; firm dollar weighs

Posted on 04 June 2015 by VRS  |  Email |Print

Nickel slid on Wednesday after inventories rose to a fresh record, while a stronger dollar weighed on some base metal prices ahead of an options expiry. Nickel was the biggest price mover on the London Metal Exchange (LME) after exchange stocks MNISTX-TOTAL jumped to an all-time peak of 470,118 tonnes, rising 13 percent this year.
Three-month LME nickel, which failed to trade in official open outcry activity, was bid down 1.1 percent at $12,910 a tonne after rising a half percent in the previous session. “Some of the warehouse arrivals in nickel appear to be linked to financing deals,” said Robin Bhar, head of metals research at Societe Generale in London………………………………………..Full Article: Source

OPEC hopes for further oil price recovery despite glut

Posted on 03 June 2015 by VRS  |  Email |Print

Angola’s oil minister said on Tuesday that $80 per barrel may be right for crude, joining a chorus of OPEC officials and delegates hoping for a further price recovery in months to come despite a global glut. “I would like the price (to) go up, but it is not easy,” Jose Botelho de Vasconcelos told reporters.
OPEC meets on Friday and is widely expected to maintain its production policy. Last November, OPEC refused to cut output and chose instead to defend market share, adding to the supply surplus arising from booming U.S. oil output. The decision prompted a crash in oil prices to as low as $46 per barrel in January, although crude has recovered to $65 in recent weeks on hopes of a slowdown in U.S. output growth………………………………………..Full Article: Source

US oil price jumps to 2015 peak

Posted on 03 June 2015 by VRS  |  Email |Print

A sharp fall in the US dollar on improved eurozone economic data has sent New York oil prices to fresh 2015 highs, even as officials at OPEC defended their generous output strategy. US benchmark West Texas Intermediate for July delivery added $US1.06, or 1.7 per cent, to $US61.26 per barrel in New York trading.
In London, Brent crude for July rose US61c to $US65.49. The US dollar lost more than 2 per cent against the euro, and 0.5 per cent on the yen, after European inflation came in at 0.3 per cent in May, better than expected and diminishing fears of deflation………………………………………..Full Article: Source

IMF: Oil price decline has limited effect on Saudi Arabian economy

Posted on 03 June 2015 by VRS  |  Email |Print

The decline in oil prices has had limited impact on the economy of Saudi Arabia so far, despite lower exports and fiscal revenues, according to the International Monetary Fund (IMF). The international financing agency, which completed its 2015 Article IV mission to Saudi Arabia, said the economy will grow at a healthy 3.5% rate in 2015, unchanged from 2014, with an increase in oil production and continued government spending expected to support the economy.
“The decline in oil prices is resulting in substantially lower export and fiscal revenues, but the effect on the rest of the economy has so far been limited,” said Tim Callen, who led the IMF mission to Saudi Arabia………………………………………..Full Article: Source

Gold price to remain rangebound in June, analyst says

Posted on 03 June 2015 by VRS  |  Email |Print

Gold prices will likely remain rangebound in June, in line with its recent spread, INTL FCStone analyst Edward Meir said in a monthly report yesterday. If the US Fed maintains a cautious stance towards an eventual rate hike at its June meeting, as is widely expected, it would generate little downside pressure, while ‘sloppy’ fundamentals are seen capping any big gains.
Coming off May, gold was evidently not strong enough to break above key resistance levels despite significant weakness in the dollar, indicating that the yellow metal will likely remain more resistant to currency movements until more clarity on Fed rates is presented………………………………………..Full Article: Source

The Gold Cartel And $3,500 Gold

Posted on 03 June 2015 by VRS  |  Email |Print

In a recent interview, Bill Murphy of the Gold Anti-Trust Action Committee (GATA) predicted that a tipping point is near that will end the Gold Cartel’s suppression of gold and silver prices, leading to $3,500 gold and $100 silver.
Greg Hunter of USA Watchdog.com interviewed Murphy, who has extensive hedge fund experience, including with Bridgewater, one of the largest hedge funds in the world. The US Justice Department recently granted UBS (NYSE:UBS) immunity in a criminal investigation of “manipulation of, or fraud in” the gold and silver markets………………………………………..Full Article: Source

India: Rajan moots minimum support price across commodities

Posted on 03 June 2015 by VRS  |  Email |Print

The Reserve Bank of India (RBI) Governor Raghuram Rajan, on Tuesday, said that minimum support price (MSP) should be available to across commodities. “In India, few commodities are getting support price……. States produce more commodities which are having MSP and less of such commodities which are not having MSP…..this creates disparity,” said Dr. Rajan while addressing a press conference here announcing the second bi-monthly monetary policy.
“Inflation control will also be helped by limiting the increase in agricultural support prices,” he added. Furthermore, he said, monetary easing could only create the enabling conditions for a fuller government policy thrust that hinged around a step up in public investment in several areas that could also crowd in private investment………………………………………..Full Article: Source

Opec: We were right not to cut oil supply, despite price slump

Posted on 02 June 2015 by VRS  |  Email |Print

‘You can see that I am not stressed, that I am happy,’ says Saudi Arabia’s oil minister. Opec’s strategy of not cutting production in order to maintain market share is working, Saudi Arabia’s oil minister said as he arrived for a meeting of the cartel to decide on output levels.
Asked if the strategy pushed by Opec kingpin Saudi Arabia was working, Ali al-Naimi told reporters in Vienna: “The answer is yes… Demand is picking up. Supply is slowing. This is a fact. The market is stabilising. “You can see that I am not stressed, that I am happy.” The 12-nation Opec cartel, pumping some 30pc of the world’s oil, is expected on Friday to maintain its official production target of 30m barrels per day (bpd)………………………………..Full Article: Source

Oil price surges ahead of OPEC meeting in Vienna

Posted on 02 June 2015 by VRS  |  Email |Print

The price of Brent oil fell almost 1 per cent on Monday to about $US65 a barrel, tempering a rally that saw oil prices climb ahead of the Organisation of Petroleum Exporting Countries meeting on Friday. The price has steadily climbed from a six-year low of $US46 a barrel in January, when a global supply glut meant that Australian consumers briefly enjoyed petrol prices as low as $1 a litre.
Since then, the commodity has experienced a “relief rally”, due to increasing expectation of a slowdown in supply from the United States, ANZ head of commodities, Mark Pervan said. “There seems to be growing expectation that the lower prices are having the effect [OPEC] is looking for, and that’s supply discipline in the US,” he said………………………………..Full Article: Source

Why $65 per barrel oil looks like a ceiling, not a floor

Posted on 02 June 2015 by VRS  |  Email |Print

Big Oil is too confident about crude prices. After a 40 percent rally from January’s six-year low, the momentum has been on the upside. But the current prices – $65 a barrel for Brent and $60 for WTI – look more like a ceiling than a floor. That is not what many insiders seem to think. Some oil service companies expect mid-$70s Brent by the end of this year.
Anglo-Dutch Shell assumed oil will rebound to $90 by 2018 in its $70 billion takeover of the UK’s BG Group. Some believe that the steep cut in capex costs will affect supply, including shale, and boost prices again. But such predictions may underestimate shale’s potential. Lower drilling and pumping costs, among other efficiencies, have pushed the breakeven cost of shale down to about $60, Goldman Sachs estimates. Lower oil prices have also helped cut costs, since shale drilling is energy-intensive………………………………..Full Article: Source

Oil price: Why further falls may be on the way

Posted on 29 May 2015 by VRS  |  Email |Print

Those hoping for a bit of oil price stability after the past few months’ volatility may be disappointed. Next week’s Organisation of Petroleum Exporting Countries (OPEC) meeting is widely expected to be another case of the cartel sitting on its hands, and maintaining levels of oil production despite historically low oil prices.
This shouldn’t be any surprise to markets – yet there are other warning signs ahead. After the last meeting in January, crude prices (WTI crude) fell to a six-year low of less than $45 a barrel, then recovered to around $65 a barrel, as the growth in U.S. supply – the main reason why OPEC has been so stubborn about cutting output — slowed in response to lower prices…………………………………Full Article: Source

OPEC sees rivals boosting oil output despite weak prices

Posted on 29 May 2015 by VRS  |  Email |Print

The North American oil boom is proving resilient despite low oil prices, producer group OPEC said in its biggest and most detailed report this year, suggesting the global oil glut could persist for another two years. A draft report of OPEC’s long-term strategy, seen by Reuters ahead of the cartel’s policy meeting in Vienna next week, forecast crude supply from rival non-OPEC producers would grow at least until 2017.
Sluggish global demand for oil means the call on OPEC’s crude will fall from 30 million barrels per day (bpd) in 2014 to 28.2 million in 2017, effectively leaving the group with two options - cut output from current levels of 31 million bpd or be prepared to tolerate depressed oil prices for much longer…………………………………Full Article: Source

Oil price slump will not stem flow of US oil, says Opec

Posted on 29 May 2015 by VRS  |  Email |Print

Despite almost a year of low oil prices, the world’s biggest producers say that the North American oil boom shows no signs of abating, leading analysts to suggest that the global oversupply of oil could continue for at least another two years.
The Organisation of Petroleum Exporting Countries (Opec) will meet in Vienna next week to discuss its long-term strategy. A draft report seen by Reuters predicts that rather than contracting, oil production will continue to increase over the next two years as rival non-Opec producers – especially those in the US – expand their operations…………………………………Full Article: Source

Gold price to test $1,100/oz imminently – ANZ

Posted on 29 May 2015 by VRS  |  Email |Print

Gold lacks direction at present but could break lower to test $1,100 in the very near term, ANZ said. “The right signals might be just around the corner,” the bank said in a note on Thursday. “To us, a downside break of the $1,180-1,220 per ounce range looks imminent.”
Gold has predominantly traded in a $1,175-1,225 range this year and was last little changed from the start of 2015 at $1,189 per ounce. But the US Federal Reserve is on course to raise interest rates this year or early in 2016, which would raise the opportunity cost of holding gold and push investors into more yield-bearing assets…………………………………Full Article: Source

The Fix Is In: Gold Price Manipulation is a Global Effort

Posted on 29 May 2015 by VRS  |  Email |Print

Many people think about gold as a percentage of a country’s total reserves. They are surprised to learn that the United States has 70% of its reserves in gold. Meanwhile, China only has about 1% of its reserves in gold. People look at that and think it shows an imbalance. But the way I see it, those are not very meaningful figures.
The figures are not meaningful because all countries’ reserves are a mixture of gold and hard currencies. The currencies can be in bonds or other assets. The US doesn’t need other currencies. We print dollars, so why would we hold euros and yen?………………………………..Full Article: Source

Gold price consolidate as safe haven status wanes

Posted on 29 May 2015 by VRS  |  Email |Print

The gold price was steady on Thursday, as dollar strength continued to cap gains and the yellow metal remained under the psychologically important $1,200 level. Spot gold was last at $1,188.80/1,189.50 per ounce, a $1.10 increase on the previous day’s close, as the metal was content to tread in well-worn ranges.
“Overall, we feel that a long-term base is being formed here, paving the way for the next bull leg in the super-cycle; but current conditions favour a slip to the lower end of the range,” Triland said in a note. Meanwhile, the metal’s status as a safe haven asset waned today amid renewed optimism over Greece staying in the eurozone…………………………………Full Article: Source

Gold Price Has Bottomed – More Evidence

Posted on 28 May 2015 by VRS  |  Email |Print

Prominent analysts have announced often and persistently that gold will drop to $1,000, $850, and even below $500. Mainstream media, “gold-bashers,” and banks encourage the “gold is going lower” meme. But gold is real money, in contrast to the paper stuff that is valuable only as long as people, businesses, and countries retain confidence that it will devalue, but only slowly.
The world runs on paper and digital fiat currencies so don’t expect banks, central banks, or western governments to encourage or support gold. However, with the constant barrage of anti-gold, anti-silver, pro-dollar and pro-paper media stories, it is not surprising that people are confused, worried, and scared regarding gold prices, the value of real money, and the inevitable demise of paper currencies…………………………………….Full Article: Source

Gold is Poised to Move Lower Than Its $1,200 level

Posted on 28 May 2015 by VRS  |  Email |Print

Gold had a rough start to the week as the yellow metal dulled when it fell below the key $1,200 level, due to the strength of the U.S. dollar. For most of 2015, gold has been trading around $1,200 as it struggles to find its footing amid speculation over interest rate hikes that is causing gyrations in the markets.
Gold has mostly been more of a technical trade. Commodities are priced in U.S. dollars, so as the greenback moves higher, instruments like oil and gold generally move lower. And, of course, the reverse of this strong correlation also applies…………………………………….Full Article: Source

Copper hits month low on China, supply rise hits aluminium

Posted on 28 May 2015 by VRS  |  Email |Print

Copper hit a one-month low on Wednesday due to concerns about the economic outlook for big metals consumer China, while aluminium fell to its lowest in a year on rising production. Aluminium is in oversupply with a huge stock overhang, and output has continued to rise this year, with the latest industry figures showing daily average production rising to 68,500 tonnes in April.
Norwegian producer Norsk Hydro said it would increase aluminium output by 35,000 tonnes per year. “Although LME stocks are falling there’s (still) a lot of aluminium around and (then) we see large increases in production. Aluminium needs a deficit to erode overhead stocks,” Fastmarkets head of research William Adams said…………………………………….Full Article: Source

Commodities’ Biggest Drop of 2015 Underscores Goldman Bear View

Posted on 27 May 2015 by VRS  |  Email |Print

Commodities fell, heading for the biggest two-day selloff since November, as speculation over rising U.S. interest rates fueled a rally in the dollar. The Bloomberg Commodity Index slid 1.9 percent as of 1:20 p.m. in New York, led by losses in wheat, natural gas and crude oil. The U.S. currency strengthened versus all 16 of its major peers.
Goldman Sachs Group Inc. said on Monday that a rising U.S. dollar, cheaper oil and weaker Chinese growth will drive raw materials to reverse gains that started in March. “An increase in the dollar’s value is typically associated with lower commodity prices,” Paul Christopher, the St. Louis-based co-head of real-asset strategy for the Wells Fargo Investment Institute, which oversees $1.6 trillion, said by phone. “We will see some periods of volatility.”………………………………….Full Article: Source

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