Fri, Jul 3, 2015
A A A
Welcome preal121
RSS

Commodities Briefing - Category | Trends more

Iran nuclear crisis: Six key points

Posted on 31 March 2015 by VRS  |  Email |Print

Over a decade of negotiations over Iran’s nuclear programme come to a head on Tuesday, the deadline for a deal. Here are some of the key points to understanding what the nuclear crisis is all about.
What happens next could have major consequences for the international community and Iran. A long-running dispute over Iran’s nuclear programme has heightened tensions between Tehran and the West, but a deal on Tuesday could bring down diplomatic barriers. Failure, though, could see the crisis turn much worse………………………………………..Full Article: Source

Fed hike, Indian demand will be key for Gold: Barclays

Posted on 24 March 2015 by VRS  |  Email |Print

A likely Fed hike and seasonal physical demand will determine the intensity for risks in store for Gold, a report by Barclays said. In Q315 gold will likely be caught between scope for disinvestment as markets look for a rate hike and seasonal physical demand materializing from India.
“Our economists now see a much lower likelihood that the committee raises rates in June given the downward revision to NAIRU which means that the Fed’s estimate of labour market slack has risen. In turn, the Fed now looks for the first rate hike to occur in September and for the target range for the federal funds rate to reach 50-75bp in December, the report said………………………………………..Full Article: Source

Next Five Years Will Bring Huge Changes To China’s Commodity Demand

Posted on 23 March 2015 by VRS  |  Email |Print

Remember the commodity super-cycle? It was pedaled by the Chinese. It made smart investors like Jim Rogers filthy rich. That story is over, as everyone now knows. And the next five years are going to bring huge changes to the country’s demand for raw materials, especially coal and oil.
China’s commodity demand is in transition, says Barclays Capital’s commodity research team led by Kevin Norrish in London. What’s taking place of China’s raw materials appetite is “a less investment driven, more consumer-led economy that is not as competitive in global manufacturing, but less polluting.”……………………………………….Full Article: Source

Oil Price Drop Hurts Spending on Business Investments

Posted on 23 March 2015 by VRS  |  Email |Print

Prospects for an uptick in business investment this year are facing a major drag: The collapse in oil prices is spurring significant cutbacks by the energy-production industry, which had been a standout in an otherwise lackluster U.S. economic expansion.
Business capital spending rose 6% last year due to gains from a broad base of U.S. industries. The drag from energy this year could cut that growth rate in half in 2015, according to economists at Goldman Sachs………………………………………..Full Article: Source

ANZ forecasts surge in gold demand and price

Posted on 23 March 2015 by VRS  |  Email |Print

More gold-related investment offerings could be on the cards for local investors given estimates that demand for the precious metal is set to double in the region over the next 15 years. ANZ commodity strategist Victor Thianpiriya told The Sunday Times: “The country is already quite advanced when it comes to such options”, but there is still “room for more”.
He added that the booming demand in Asia could see prices surge to over US$2,400 an ounce by 2030, up from its level of US$1,170 now. An ANZ report on Wednesday said that the price rise will be fuelled by long-term growth in the key consumer markets of China and India, which are already the world’s largest consumers of gold……………………………………….Full Article: Source

Is the tide turning for Precious Metals?

Posted on 23 March 2015 by VRS  |  Email |Print

Has the tide begun to turn for the precious metals, notably silver and gold? In our view the turn began last year and if pressed to pinpoint one event, it would be following the failure of the Swiss referendum when the SNB de-pegged the franc from the euro. The Swiss National Bank was frustrated with the continued depreciation of the Euro. This had as much to do with sentiment as it did with the SNB clearing seeing the Euro might be going the way of the Rentenmark.
Around this timeframe, investors received a flurry of news regarding worldwide demand for both silver and gold. This news continues to pore in, that multiple factions that are unsure of the longevity of the U.S. dollar continue to buy precious metals. For example, net silver imports into India in November, set an all-time monthly record. This would be followed by a record setting year of net silver imports, amounting to 7,063 tons………………………………………..Full Article: Source

Kuwait Says OPEC Has No Choice But to Keep Oil Production Target

Posted on 20 March 2015 by VRS  |  Email |Print

OPEC has no plans for an extraordinary meeting to discuss ways to shore up oil prices and doesn’t have a choice but to keep its crude production unchanged to maintain market share, Kuwait Oil Minister Ali Al-Omair said.
If other producers want to cut supply, “we will be very happy,” al-Omair said in Kuwait City. No “serious” requests have come from OPEC members to hold early talks so “accordingly the next meeting will be in June,” he said………………………………………..Full Article: Source

Will The Oil Markets (And Shale Producers) Capitulate Before Demand Recovers?

Posted on 19 March 2015 by VRS  |  Email |Print

Is the U.S. shale industry at a tipping point? Oil prices fell to a six-week low on Friday after the International Energy Agency warned that the U.S. may soon run out of room to store all the oil being pumped out of shale plays across the country.
As oil starts to back up, the worry is that prices could fall like a rock. But despite this grave warning, bullish oil traders are keeping their cool. They believe that the low prices will ultimately decimate the U.S. shale industry, removing a large chunk of supply from the market indefinitely, similar to what happened during the last major oil price crash 30 years ago………………………………………..Full Article: Source

Is gold finally ready to rebound?

Posted on 19 March 2015 by VRS  |  Email |Print

Analyst Jim Bianco argues that gold may have already reached its bottom. There are few more polarizing topics in the world of investing than gold. The shiny metal, which for centuries was the basis of the global monetary system, is beloved particularly by investors whose political beliefs tilt libertarian.
These are the sort of people who are convinced of the incompetence of political leaders and central banks that now run a monetary system based on floating exchange rates rather than the value of hard metals. Gold enthusiasts had their moment in the sun during the 2000s, when the combination of rising deficits and a sharply falling dollar helped give the precious metal its best stretch since the inflation-racked 1970s and 1980s………………………………………..Full Article: Source

Iran’s Nuclear Deal Could Open Oil Flood

Posted on 18 March 2015 by VRS  |  Email |Print

Iran, the U.S. and its allies are pushing ahead with talks over a nuclear deal that would change many things—perhaps none faster than the price of oil. Iranian exports in recent years have been essentially capped by Western sanctions aimed at pressuring Tehran over its nuclear ambitions.
A deal easing those sanctions could eventually translate into half a million barrels or more a day in Iranian crude heading into a currently glutted global market, analysts estimate. With global crude prices already under pressure, a deal could quickly knock them lower. U.S. oil prices slumped to a six-year low Monday on fresh signs that supplies are swamping the market………………………………………..Full Article: Source

US shale boom may be over by end of 2015 – OPEC

Posted on 18 March 2015 by VRS  |  Email |Print

OPEC is forecasting a possible decrease in US shale oil production by the end of 2015. The number of operating drilling rigs working shale deposits is likely to fall since the price of oil has more than halved since June 2014. The cartel questions the ability of US producers to withstand the dramatic collapse in oil prices and predicts that global oil supply will equal demand, it said in its monthly report published Monday.
“Tight crude producers are aware that typical oil wells in shale plays decline 60 percent annually, and that losses can only be recouped by drilling new wells,” says the report. “As drilling subsides due to high costs and a potentially sustained low oil price, a drop in production [in the US – Ed.] can be expected to follow, possibly by late 2015.”……………………………………….Full Article: Source

Oil plunges to a 6-year low. Is $30 a barrel next?

Posted on 17 March 2015 by VRS  |  Email |Print

Extremely cheap oil is back, and it may get even cheaper. Crude plunged 4% to as low as $42.85 a barrel on Monday. That’s the lowest price since March 2009 and marks the fifth consecutive day of losses. This should bring smiles to the faces of the millions of American drivers who have watched gasoline prices creep higher in recent weeks.
A month ago, people were talking about an “oil comeback.” Now that looks like just a mirage. More and more analysts predict prices of $40 or lower, at least in the near term. “I think the market almost has to have a $30-handle on it before it gets this out of its system,” said Tom Kloza, chief oil analyst at the Oil Price Information Service………………………………………..Full Article: Source

Non-Opec oil production growth to weaken in 2015

Posted on 17 March 2015 by VRS  |  Email |Print

Slower growth in non-Opec oil production is expected in 2015, but it will take some time yet to assess the full impact of lower prices on North American output, Opec said on Monday. Oil prices have halved since levels reached in mid June last year, triggering a pullback in the number of rigs drilling for oil and a slew of announcements by energy companies about spending cuts.
But the full impact on “US tight [or shale] oil and Canadian oil sands output, will become more evident in the coming months,” the oil producers’ group said in its monthly report………………………………………..Full Article: Source

Africa sets its sights beyond commodities

Posted on 16 March 2015 by VRS  |  Email |Print

The collapse of commodity prices has hit resource-dependent African countries hard, but it is forcing them towards economic diversification, presenting fresh opportunities for outside investors. The big bang in demand for raw materials, driven mostly by China, has been good for African mineral producers. Too good perhaps, as little effort was made during the boom years to lock in gains by diversifying.
Of Africa’s 54 countries, 24 rely on a select few mineral products to generate more than 75 per cent of their export earnings, according to a study by the African Development Bank (ADB). A further 20 countries that do not have much in the way of resources still managed to grow by more than 4 per cent, as regional benefits spilt across national boundaries………………………………………..Full Article: Source

OPEC Yet To ‘Taste’ Bottom Of The Barrel

Posted on 16 March 2015 by VRS  |  Email |Print

Saudi Arabia will not cut its oil production to satisfy others. The lesson is learned and others must act accordingly. Finally, Saudi Arabia has reached its conclusion and it will keep on producing more oil as long as its customers demand for oil. This time, the biggest oil exporter is determined to push for more crude oil production and lower prices until other non-OPEC producers reduce their oil production.
Last November, a meeting in Vienna witnessed total shift in Saudi oil policy in terms of giving up its traditional ‘swing’ role producer to become an integral part of the global oil policy. Countries like Russia, Brazil and other higher cost oil producers were asked to participate and reduce their production until such time that the global market can take all available crude oil or to share the burden equally………………………………………..Full Article: Source

Why Analysts Expect Oil Price To Plummet Further

Posted on 13 March 2015 by VRS  |  Email |Print

The Energy Information Administration (EIA) of the US reported oil inventory data of the country on Wednesday. EIA report showed an increase of 4.5 million barrels in crude oil supplies during the last week, taking the inventory to 448.9 million barrels.
According to the EIA, this is the ninth weekly gain and represents an 80-year high level. Compared to this time last year, crude inventories are approximately 20% higher. West Texas Intermediate (WTI) futures are the benchmark of crude oil price in the US. The physical point of its delivery is in Cushing, Oklahoma, where crude oil supply has increased by 2.3 million barrels to reach 51.5 million barrels………………………………………..Full Article: Source

China, India drive global energy needs: Ex-OPEC official

Posted on 13 March 2015 by VRS  |  Email |Print

The global energy industry has seen huge demand from two fast-growing major economies - China and India - even as consumption dropped in Europe. “These two countries have launched themselves to a high growth zone,” said Abdullah bin Hamad al-Attiyah President of the Administrative Control and Transparency Authority ( ACTA).
“Take the case of India, from a very classical agrarian-based economy with just textile exports, India has become a giant in industry, IT and many sectors,” Abdullah was quoted as saying by the Gulf Times. China and India would need huge amounts of energy to achieve their growth targets………………………………………..Full Article: Source

Did lower oil prices help the economy at all?

Posted on 12 March 2015 by VRS  |  Email |Print

The oil price plunge has been touted as a global growth elixir, but so far the impact on the economy has been subtle and it’s unclear when that will change.
“Local fuel prices have almost fully adjusted to lower crude oil prices,” Goldman Sachs said in a note last week after tracking data from 24 countries. But it expects the stimulus impact on the economy won’t be straightforward, depending on whether low prices are perceived as likely to persist and government policy responses………………………………………..Full Article: Source

How to read the changing signals from China’s metals trade: Andy Home

Posted on 12 March 2015 by VRS  |  Email |Print

China will be the key determinant of industrial metal prices this year. Nothing new there then. The country has played the starring role in the sector for many years, thanks to its stellar contribution to global demand growth for everything from aluminium to zinc.
What has changed over the last couple of years, though, is the country’s own surging output of refined metals following years of production capacity growth. In the aluminium market, for instance, what China imports from the rest of the world is far less significant for prices than what it exports………………………………………..Full Article: Source

Why the Dollar Rally Is Hurting Your Commodities

Posted on 12 March 2015 by VRS  |  Email |Print

During the past few trading days, it has become increasingly clear that the impending market volatility that I’ve been warning about lately has arrived. Here’s the long and short of what is happening with the market right now…
Any time the dollar rallies — it had a dramatic rally on Friday and another dramatic rally yesterday — the market pulls back because commodities (oil, gold, aluminum, etc.) are priced in U.S. dollars. So, when the dollar rallies, commodity prices — especially oil prices — fall. I recommend a handful of commodities-related stocks, and we’re seeing the strong dollar weigh on these stocks in the near-term………………………………………..Full Article: Source

Gold price: Apple Watch ‘will boost gold price’

Posted on 11 March 2015 by VRS  |  Email |Print

The languishing gold price could soon be on the rise, some analysts predict, as Apple starts stoking demand with its new gold smartwatch. As well as becoming one of the most sought-after tech devices of the year, the new Apple Watch could become the “world’s biggest gold price catalyst” in 2015, MoneyMorning.com suggests.
The high-end Watch Edition will have a case made of 18-carat gold and will start at $10,000. Even under the most conservative sales projections and estimates of how much gold will be used in the production of each Watch, the device is likely to have an impact on gold prices, the site suggests………………………………………..Full Article: Source

Global Commodities Under Pressure

Posted on 10 March 2015 by VRS  |  Email |Print

With the dollar’s renewed strength and slower global demand, commodities are under pressure again. The situation in Brazil is not helping as the weak Brazilian real encourages producers to dump commodities at lower prices (in dollar terms). And Brazil is one of the largest commodity exporters in the world (from Corn to iron ore).
While the dollar rally and the weakness across the energy patch are pressuring commodities, other drivers exists as well. One specific commodity to watch closely is lumber. And China’s recent growth downgrade is sending iron ore futures to multi-year lows……………………………………….Full Article: Source

China Commodities Imports Slow as Lunar New Year Cools Trade

Posted on 10 March 2015 by VRS  |  Email |Print

China’s commodity trade slowed in February as the Lunar New Year holiday crimped imports of oil, iron ore, copper and soybeans while exports of aluminum and steel fell. Inbound shipments of copper tumbled by the most in four years, soybeans to the least since October, while oil and iron ore imports slowed to the weakest in three months, according to customs data released Sunday in Beijing.
Steel exports fell for the first time since August and the country shipped the smallest amount of aluminum products in four months. The slowdown in raw materials trade reflects the impact of the country’s most-important festival, when factories and output slow before and during the weeklong holiday………………………………………..Full Article: Source

GCC’s rich confident about local economies despite oil price fall

Posted on 09 March 2015 by VRS  |  Email |Print

The majority of GCC’s high net worth individuals (HNWIs) are more optimistic about the economic situation in the region than global growth prospects, a new survey showed. According to a report by Emirates Investment Bank, almost 55 per cent of those polled said that the economic condition in the Gulf was improving compared to jus t 31 per cent who were optimistic about the global economy.
HNWIs are defined as individuals with $2 million or more in investable assets. The survey was conducted among GCC’s HNWIs in the fourth quarter of 2014, a period characterised by falling oil prices………………………………………..Full Article: Source

OPEC Chief Says Cartel Is Hurting U.S. Shale Producers

Posted on 09 March 2015 by VRS  |  Email |Print

OPEC’s top official said Sunday that the cartel’s decision to keep pumping crude in the face of collapsing prices is hurting the U.S. shale-oil industry and a global pullback on investment could lead to a shortage that will push the market upward again.
“Projects are being canceled. Investments are being revised. Costs are being squeezed,” said Abdalla Salem el-Badri, the secretary general of the Organization of the Petroleum Exporting Countries, at the Middle East Oil and Gas conference in Bahrain. “If we don’t have more supply, there will be a shortage and the price will rise again.”……………………………………….Full Article: Source

Specialty funds let you play with the pros in commodities sandbox

Posted on 05 March 2015 by VRS  |  Email |Print

As the Crimean crisis raged last summer, Tyler Mordy and his colleagues at Hahn Investment Stewards made a tactical call in the commodities market. Believing that Russia’s aggression would stoke a major political crisis, they invested in palladium, a silvery-white metal essential in the production of catalytic converters, fuel cells and countless types of electronics.
Russia is the largest source of palladium, and investors speculated about supply disruptions and dwindling stockpiles, sending prices skyward. “Palladium took off like a scalded cat. It worked out incredibly well for us last year,” recalls Mr. Mordy, who is director of research and co-chief investment officer at the Toronto-based firm………………………………………..Full Article: Source

Economist’s faith in oil price rebound vindicated

Posted on 03 March 2015 by VRS  |  Email |Print

Oil prices have been climbing steadily since the end of January, a rebound that has brought some cheer to TAC Economics chairman Thierry Apoteker. Not because the chief economist of the French-based research firm had bet big on the nascent rally that has taken the shine off naysayers’ predictions that oil prices would stay depressed.
Instead, he can afford to breathe just a tad easier as he believes he has been proved right in his predictions. At the start of the year, as oil prices languished in the doldrums with doomsday predictions of a plunge to US$20 a barrel, Dr Apoteker was the odd man out………………………………………..Full Article: Source

India’s Gold Buying to Pick Up After Budget

Posted on 03 March 2015 by VRS  |  Email |Print

Traders are bracing for a short-term bump upward in India’s gold demand after the world’s largest consumer of the precious metal maintained an import duty in a budget unveiled Saturday. In the weeks leading up to the budget announcement, India’s gold imports slowed. Some wholesalers delayed purchases, anticipating that the government would announce a cut in taxes on gold imports.
Imports in January totaled around 39 metric tons, according to Macquarie Group Ltd. That compares with a monthly average of 81 tons in the second half of 2014. Data for February isn’t available, but traders and analysts said imports remained subdued last month………………………………………..Full Article: Source

Commodities languish but signs of recovery emerge

Posted on 02 March 2015 by VRS  |  Email |Print

Is this as bad as it gets? The question is suggested by the fact that, even while commodities are performing poorly, green shoots of hope are emerging (as oil prices have been showing). Canada’s Scotiabank reports its commodities index plunged again in January, dropping below the April 2009 low (post the GFC). Commodity prices are now at ­levels last seen in January 2007.
The bank’s commodity analyst Patricia Mohr says that, while global economic conditions are better than in 2009, an extended period of sub-par world GDP growth has triggered intensely competitive global markets, ­taking the steam out of commodity prices………………………………………..Full Article: Source

Explaining the global oil-price drop

Posted on 02 March 2015 by VRS  |  Email |Print

The Middle East is burning. Jets fighter from Saudi Arabia, Jordan, the United Arab Emirates (UAE) and Egypt have attacked numerous Islamic State (IS) movement targets in Syria, Iraq and Libya, mainly in response to the sadistic killing of a captured Jordanian pilot, Moaz al-Kasasbeh.
In this hostile conflict, begun in June 2014, oil prices have dropped significantly, from the highest level of more than US$100/barrel in 2010 to approximately $50 this year. Yet Saudi Arabia, the biggest oil producer in the Organization of the Petroleum Exporting Countries (OPEC) did not do anything to cut oil supply, to stabilize prices………………………………………..Full Article: Source

Commodities Bust Leaves Latin America with a Hangover

Posted on 27 February 2015 by VRS  |  Email |Print

Five years ago spirits were soaring across Latin America. The region’s economies were bouncing back with startling speed from the global financial crisis to post their strongest growth rates in more than a decade. Robust Chinese demand for copper, iron ore, oil, soybeans and other commodities was filling government and private sector coffers and lifting millions of people into the ranks of the middle class.
Companies like Brazilian aircraft maker Embraer, Chilean fashion retailer Falabella and Mexican bakery goods manufacturer Grupo Bimbo were extending their reach across the region and around the world. The Economist boldly proclaimed the region to be on the verge of a Latin American decade………………………………………..Full Article: Source

Hedge Fund Returns Falter, Yet Money Continues to Flow In

Posted on 27 February 2015 by VRS  |  Email |Print

Another year, and another mediocre performance by hedge funds, to put it kindly. The Barclay Hedge Fund Index gained a meager 2.89 percent in 2014, while the Standard & Poor’s 500-stock index gained over 13 percent and the Barclays United States Aggregate Bond Index rose over 5 percent.
Even as their high fees have minted scores of new billionaires, hedge funds have now substantially underperformed a simple blend of index funds — 60 percent stocks and 40 percent bonds — for three-, five- and 10-year periods. And the 10-year numbers cover the period of the financial crisis and the sharp decline in stocks — the very calamity that hedge funds are supposed to protect against………………………………………..Full Article: Source

Commodity crash reflects global economic slump

Posted on 25 February 2015 by VRS  |  Email |Print

Global commodity prices have tumbled to levels below the depths of the Great Recession, underscoring the widespread difficulties facing the global economy. While crude oil’s price collapse has been in the spotlight, a wide range of other commodities are suffering as well, including natural gas, coal, iron ore, copper, grain and pulp and paper.
The commodity crash is the result of too little demand for raw goods now in plentiful supply after producers ramped up capacity in recent years in anticipation of steady global growth. But trouble spots are everywhere. Commodity markets have declined during worldwide turbulence as the pace of growth in China continues to slow, Russia grapples with an imploding economy and ruble and Greece struggles through an economic crisis that Europe must solve. ……………………………………….Full Article: Source

Oil continues to fall, and Opec isn’t helping

Posted on 24 February 2015 by VRS  |  Email |Print

It was another down day in the oil market: Crude prices fell more than 2 per cent on Monday, with WTI finishing Feb. 23 below US$50 a barrel for the first time in almost two weeks. For a moment, things looked like they might go the other way. Opec President Diezani Alison-Madueke said in a Financial Times report on Monday that she would call an emergency meeting of the Organization of Petroleum Exporting Countries if prices continue to fall. Oil prices reacted sharply to the news-until they fell again.
In addition to being Opec president, Alison-Madueke serves as Nigeria’s oil minister, and cheap oil has helped sow crisis in Nigeria. The Nigerian currency, the naira, is at all- time lows against the US dollar, terrorist attacks by the Islamist group Boko Haram have worsened, and national elections were recently postponed more than a month………………………………………..Full Article: Source

What looks attractive in commodities investment?

Posted on 23 February 2015 by VRS  |  Email |Print

Investors in the equity markets pained by the sideways movement in stocks, have attractive options in another universe called commodities. Even though commodities as an asset class has reached an end of the super bull cycle, there are enough opportunities in the market, which investors can profit from such as industrial and precious metals.
Bullish copper: Fundamentally, a reduction in the surplus situation and supply worries could support copper, the major industrial metal, going forward. Though Chinese consumption and growth have been a major concern, China’s efforts to prop up growth by way of fresh stimulus will deter a further sell-off, analysts say………………………………………..Full Article: Source

With OPEC Taking Away the Punch Bowl, U.S. Oil Companies Are Sobering Up

Posted on 23 February 2015 by VRS  |  Email |Print

America’s energy industry hadn’t been having this much fun since Ronald Reagan was in the White House. With the price of oil intoxicatingly high over the past few years, oil companies have been using it to fuel one of the greatest oil production booms in the country’s history. In just a few short years, we’ve wiped out decades of declines and are now producing more oil than we have since the 1980s.
There’s just one problem, and that’s the fact that the world didn’t yet need all of the oil we’re now producing. But, few could see that, because everyone was a bit too tipsy on the intoxicating allure of the profits that could be made from triple-digit oil prices. It’s a price no one expected to see go away, as the group with the most control over the price of oil, OPEC, was enjoying the $100 vintage just as much as the next guy………………………………………..Full Article: Source

Oil giant BP predicts Opec comeback as Brent crude price rises

Posted on 23 February 2015 by VRS  |  Email |Print

Saudi Arabia and its fellow Opec members are set to make a massive comeback and regain control of the world’s crude oil market, and could be in their previous position of influence as early as next year. The prediction, published by oil giant BP, is based on growth in America’s production of shale gas slowing down.
The US shale boom is partly behind a collapse in global oil prices over the past six months. BP believes the Organisation of Petroleum Exporting Countries (Opec) will be back on top within the next 15 years. The firm stated that Opec will regain its traditional 40 per cent market share by the end of 2035………………………………………..Full Article: Source

Gold – Forming a base as selling abates

Posted on 20 February 2015 by VRS  |  Email |Print

Gold remained under pressure in the final quarter of 2014 on dollar strength and growing demand for higher-yielding risk assets. Technical selling was also a feature after gold breached double bottom chart support around $1,180. The price weakness stimulated physical demand as gold entered its seasonal peak demand period.
Demand is expected to remain strong early this year while Chinese demand is boosted by New Year-related purchases. Further asset diversification among emerging market central banks has also been evident, absorbing continued liquidation from western institutional investors, also a trend we expect to continue in 2015………………………………………..Full Article: Source

OPEC is going to make a massive comeback, BP predicts

Posted on 19 February 2015 by VRS  |  Email |Print

One of the big stories of the past few years has been the boom in unconventional gas and oil extraction outside the traditional oil-producing countries. The explosion of fracking in the U.S. seemed as if it was dislodging the old oil-producing countries permanently.
But that is not likely, according to BP’s latest 20-year outlook for the energy market. BP says the Organisation of Petroleum Exporting Countries (OPEC) isn’t going anywhere, and it will actually make a comeback. BP is forecasting “OPEC’s market share by the end of the Outlook is around 40%, similar to its average of the past 20 years.”……………………………………….Full Article: Source

Australia’s tycoons suffer commodities hangover

Posted on 18 February 2015 by VRS  |  Email |Print

The commodities slump has dented economies, capital expenditure and profits. Now it is scything the wealth of some of Australia’s most colourful tycoons. Andrew “Twiggy” Forrest, the founder and chairman of Fortescue, has seen the value of his one-third shareholding in the iron ore miner fall to A$2.65bn, down from A$6.2bn a year earlier.
The latest Forbes rich list, which was published last month, ranks Mr Forrest as the 10th richest Australian, down from fifth last year. Gina Rinehart remains Australia’s richest, although her wealth fell to US$11.7bn, down US$6bn on the previous year………………………………………..Full Article: Source

BP’s 2035 outlook sees OPEC oil gaining ground as U.S. shale slows

Posted on 18 February 2015 by VRS  |  Email |Print

OPEC will regain ground and exceed its historic record production levels by 2030 as U.S. shale oil growth flattens out in the coming years, energy company BP said on Tuesday. In the near term, demand for oil from the Organization of the Petroleum Exporting Countries (OPEC) is likely to remain under pressure as U.S. shale oil production remains strong, BP said in its annual benchmark Energy Outlook 2035.
Production of tight or shale oil in the United States has been the main driver in supply growth that prompted the near halving of oil prices since July as OPEC opted not to cut its own production………………………………………..Full Article: Source

Gold has bullish hopes, sobering current reality

Posted on 17 February 2015 by VRS  |  Email |Print

The price of gold appears caught in a holding pattern, stuck between what is actually happening to demand and what potentially may happen. The World Gold Council’s latest quarterly report provides a snapshot of the different dynamics at work in the gold market, and goes some way to explain why the precious metal has been marooned in a fairly narrow range for almost two years.
The broad picture from the council’s Gold Demand Trends 2014 report is that last year was the weakest since 2009. This fits in with spot gold’s modest 1.8 percent decline over the year, but the breakdown of that demand shows where the pressure points are located………………………………………..Full Article: Source

Is Productivity Responsible For Drop In Commodity Prices?

Posted on 16 February 2015 by VRS  |  Email |Print

Is there a productivity force at work driving commodity prices lower? Why might lumber prices be higher? What industry cousin might offer clues about innovation in commodity markets? One of the more perplexing developments in this economic recovery is the collapsing prices of commodities.
During an economic expansion demand for commodities typically rises, sending prices higher. That has not been the case in this recovery. Metals, agriculture, energy, livestock and cotton - all of these commodities are trading at prices well below levels at the start of 2012. How could this be?……………………………………….Full Article: Source

Commodities are down-but hardly out

Posted on 13 February 2015 by VRS  |  Email |Print

Do commodities still have a place in the average investor’s portfolio? The 2007-09 recession caused everyone to re-evaluate their tolerance for risk, and nowhere was this felt more strongly than in the commodities arena, where anything from a coffee-eating pest to severe drought could cost an investor hundreds of thousands of dollars.
Several years of negative returns for most commodities haven’t endeared the asset class to investors: For the three years through January, the S&P GSCI Commodity Index posted a negative return of 40 per cent. That came after a 52 per cent decline between June 2008 and June 2011………………………………………..Full Article: Source

Rising Oil Lifts All (Commodity) Boats

Posted on 13 February 2015 by VRS  |  Email |Print

In the commodity markets, a rising price of oil lifts all boats. The 24 commodities in the S&P GSCI index aren’t directly correlated with oil prices, as each raw material moves on its own supply-and-demand dynamics.
But new data from S&P Dow Jones Indices show that when U.S. oil prices are up, it’s hard for other commodities to be down – and vice versa. On average, when oil is up in a month, the index’s 23 other commodities have positive months too, according to an analysis by Jodie Gunzberg, global head of commodities at S&P Dow Jones Indices. When oil is down, 21 other commodities also have down months, on average………………………………………..Full Article: Source

Gold demand sinks to five-year low in 2014

Posted on 13 February 2015 by VRS  |  Email |Print

Global gold demand slumped to its lowest level in five years in 2014 as bar and coin buying plunged and jewelry purchases cooled, according to the World Gold Council (WGC). Overall demand totaled 3,924 tonnes, down 4 percent on year at its lowest level since 2009, the WGC’s quarterly demand trends report, published on Thursday, showed.
Total bar and coin investment fell 40 percent to 1,064 tonnes as investors, who had made major purchases in 2013 amid a sharp fall in prices, held back from further purchases, the industry group said………………………………………..Full Article: Source

Why Oil Prices Will Rebound Before We Know It

Posted on 12 February 2015 by VRS  |  Email |Print

Oil industry analysts have been engaging in a burning debate: Have prices hit bottom or do they have further to fall? Energy company CEOs have been voicing their views on the question as they report their quarterly earnings results. The International Energy Agency weighed in as well in a somewhat bearish five-year forecast released Tuesday, saying that oil prices will eventually rebound from current levels but still stay below the $100 a barrel mark.
The group said global stockpiles would rise, putting prices under more pressure before spending cuts by oil producers kick in to ease the supply glut. Here’s a safe call: Get ready for plenty of thrills, chills and volatility along the way. Let’s take a look at five key lessons from energy company conference calls so far this earnings season, and at several stocks that will benefit from the next chapter that’s about to play out in the ongoing saga of oil price volatility………………………………………..Full Article: Source

Top oil analyst: The worst is yet to come

Posted on 12 February 2015 by VRS  |  Email |Print

Oil prices will get a heck of a lot worse before they get better, a top industry analyst said on Tuesday. Tom Kloza, chief oil analyst at Oil Price Information Service, predicted that oil prices would bottom during the second quarter of the year “simultaneously to one of the expirations of the WTI contracts.”
He warned that the price of West Texas Intermediate crude could be in the $30s at some point in the second quarter. “I think the cycle has a long way to run out,” Kloza said on CNBC’s “Fast Money,” adding that the spread between Brent and WTI could widen to about $10 or so………………………………………..Full Article: Source

Decline in commodity prices not benefiting the end-users

Posted on 11 February 2015 by VRS  |  Email |Print

The sharp fall in commodity prices over the past few months is not benefiting end-users. While the Indian basket crude oil prices have plunged 29.5% between October and December, retail petrol prices dropped just by over 6.5% for the period. Despite the revision in petrol and diesel prices early this month, they have not kept pace with the fall in crude prices.
Ditto with other commodities as well. Cotton prices have declined nearly 10% since October but yarn prices have not dropped at the same rate. While woven yarn prices have dropped only marginally, hosiery yarn prices have declined by only 4.7% since October, data with the union textiles ministry showed………………………………………..Full Article: Source

US shale oil boom could become next ‘dotcom bubble’, says Russian oil boss

Posted on 11 February 2015 by VRS  |  Email |Print

The head of top Russian oil producer Rosneft has ​said the US shale ​energy boom could become the next “dotcom bubble”. Igor Sechin also accused Opec ​of destabilising the market by allowing the oil price to halve in six months.
​​He predicted that​ the rapid growth of fracking in the US would start to peter out after 2020. “We know that revolutions are short-lived and the US production increase is not well supported by reserves,” ​Sechin told an industry conference in London on Tuesday………………………………………..Full Article: Source

banner
banner
July 2015
S M T W T F S
« Jun    
 1234
567891011
12131415161718
19202122232425
262728293031