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Commodities Briefing - Archive | October, 2013

Water as a commodity: can investors boost access to this critical resource?

Posted on 31 October 2013 by VRS  |  Email |Print

‘Blue gold’ investors claim to improve access to a vital resource, but critics argue commoditization may out-price the poor. From commodity guru Jim Rogers to the likes of Goldman Sachs, it has become almost cliché to refer to water as “blue gold” – a whole new commodity that can be bought and sold on par with gold, oil and corn.
After all, as demand grows and water infrastructure crumbles, the world is running out of drinkable water. And many believe the problem can only be solved if cash-strapped governments team up with “angel” investors and others in the private sector……………………………….Full Article: Source

Tax-wise commodity investing

Posted on 31 October 2013 by VRS  |  Email |Print

Inflation is tame and commodities are having a ragged year—so now is a great time to buy commodities. No sense buying hard assets when everyone else is.
There’s more than one way to bet on gold, oil and copper. Let’s look at a few, paying particular attention to the costs and tax rules. It gets tricky, since Congress (motto: We keep you entertained) has created no fewer than six tax regimes for commodity investments……………………………….Full Article: Source

Regulatory uncertainty over commodity units

Posted on 31 October 2013 by VRS  |  Email |Print

Bank ownership of commodity operations has generated lots of controversy recently. When the heat intensified, JPMorgan Chase wasted no time in announcing it would sell its physical commodity ownership business, to the surprise of no one. Goldman Sachs has not followed suit with regard to its Metro warehousing unit, but surely the issue has come up internally.
As for trading operations, the Federal Reserve has come under fire for a lack of bright lines in this area. However, it “may not unveil its plans for regulating Wall Street’s commodity trading business until early next year,” reports Reuters……………………………….Full Article: Source

Scotiabank’s Commodity Price Index loses further ground in September

Posted on 31 October 2013 by VRS  |  Email |Print

Scotiabank’s Commodity Price Index fell in September, declining 2.8% month over month (m/m) and 3.8% year over year (yr/yr). While the All Items Index will likely fall further over the balance of 2013, the correction in commodity prices, especially in metals and minerals, since April 2011 should be largely over by year-end.
“Traditionally, junior mining companies have been important contributors to mineral exploration across Canada, finding and delineating deposits, before selling them to senior producers for development,” said Patricia Mohr, Scotiabank’s Vice President of Economics and Commodity Market Specialist. “However, equity capital raised by junior mining companies on the TSX Venture plunged in 2012 and has moved even lower in 2013 year to date. (Press Release)

New regulations may curb commodity business of Wall Street banks

Posted on 31 October 2013 by VRS  |  Email |Print

Several major banks involved in commodities business would find the going tough following the Federal Reserve move to regulate the bsuiness and impose new capital charges, according to news reports.
The Federal Reserve may review the permission granted to banking majors who engage in trading of physical commodities such as oil and metals and impose curbs on their operations. This has caused apprehensions among the banking community– Citigroup, Barclays, JPMorgan, Goldman Sachs being some of them……………………………….Full Article: Source

Oil and politics: Who will take over from the US in the Middle East?

Posted on 31 October 2013 by VRS  |  Email |Print

There is little doubt that politics as we knew it in the Middle East is changing right before our very eyes and with that shift in politics will unavoidably come a change in the policies of oil, as the two go hand in hand in the region where the Arab countries have learned since the October 1973 Arab-Israeli War that oil can be a very powerful weapon.
First among the major changes to occur in recent weeks has been the icing of relations between Saudi Arabia and the United States, two countries who for the longest time were the closest of friends in the Middle East, except perhaps for the relation that the US had with Israel……………………………….Full Article: Source

Statoil chief casts doubt on Arctic oil production potential

Posted on 31 October 2013 by VRS  |  Email |Print

Statoil’s chief executive played up the Norwegian oil company’s positions in what he called “the workable Arctic”, in Norway and eastern Canada, while casting doubt over imminent success in other parts of the polar region.
Arctic oil exploration has been hit by a series of bad headlines after Royal Dutch Shell and Cairn Energy spent billions of dollars with disappointing results in Alaska and Greenland respectively……………………………….Full Article: Source

Libya’s oil exports still restricted, little improvement

Posted on 31 October 2013 by VRS  |  Email |Print

Libyan crude oil exports showed little improvement on Wednesday after falling to a trickle this week, except for one tanker that was expected to load condensate from the small western port of Mellitah, trading sources said.
Over the weekend, Libya’s two western ports of Zawiya and Mellitah suspended oil exports, on top of the closures of its eastern facilities……………………………….Full Article: Source

India: High gold price forces shift in jewellery buying habit this festive season

Posted on 31 October 2013 by VRS  |  Email |Print

Rising gold prices are fast forcing change in women’s jewellery buying habits also aided by the changing fashion trends from the yellow metal to diamonds and other metals like platinum, reveals an ASSOCHAM recent survey ahead of Dhanteras and Diwali festivals.
For the ASSOCHAM Survey on “Diamonds and platinum shines as gold loses sheen in Urban cities” the research team interacted with about 350 jewellery makers based in Delhi-NCR, Mumbai, Ahemdabad, Chennai, Kolkata, Hyderabad, Chennai, Bangalore, Chandigarh and Dehradun. The jewellers in major cities like Delhi-NCR, Mumbai, Chennai, Ahemdabad, Kolkata, Dehradun are looking at unique mix of strategy to sell jewellery in the current fluctuating market conditions……………………………….Full Article: Source

Why investors shouldn’t lose interest in gold producers

Posted on 31 October 2013 by VRS  |  Email |Print

The reason behind this is both simple and apparent: gold bullion prices have declined and as a result, gold producers are facing pressures. Pessimism towards gold producers is very high; some are even calling them the worst investment to hold in your portfolio.
Just look at the chart below of the Market Vectors Gold Miners ETF, an exchange-traded fund (ETF) that tracks the performance of well-known gold producers. This ETF has lost more than half of its value since 2012, with a majority of the losses coming in 2013. So why would an investor want to buy this ETF? After all, no one wants to catch a falling knife……………………………….Full Article: Source

Gold and the evolution of the dollar

Posted on 31 October 2013 by VRS  |  Email |Print

As more and more liquidity is pumped into the global financial system, so gold bugs have become increasingly vocal about the precious metals monetary properties and the importance of hard assets.
And, for good reason, they argue, the metal has been used as a monetary asset for centuries. But, while it remains a medium of exchange in some places, currently world’s reserve currency is the US dollar. And, any view of gold’s long-term prospects must take account of the outlook for the US dollar……………………………….Full Article: Source

Consumer demand will feed metals supercycle: mining mogul

Posted on 31 October 2013 by VRS  |  Email |Print

The billionaire mining mogul has purchased a Hollywood film studio to make movies—but he’s not ditching his bread and butter any time soon. Friedland’s goal is to produce films that highlight the importance of mining and underscore the urgency of finding new ore bodies to satisfy the globe’s growing appetite for metals.
“It’s remarkable how many people who live in urban environments don’t understand the supply chain,” Friedland said during an Oct. 9 talk at Laurentian University in Sudbury. “They don’t understand that if you walk in the room to turn on a light switch, somewhere a generator has to kick in and provide that power; there’s no storage of electricity in the grid.”………………………………Full Article: Source

Nickel rises on heavy demand

Posted on 31 October 2013 by VRS  |  Email |Print

Nickel prices rose at the non-ferrous metal market here today on heavy stockists demand amid good offtake from alloy industries. Elsewhere, select copper and aluminium utensils gained due to better offtake from consumer industries.
Meanwhile, copper sheet cutting fell owing to lower demand from industrial users. The industrial metals was trading unchanged at the LME, well below last week’s one-month high on a weaker fundamental outlook as investors await clues on monetary policy from the US Federal Reserve……………………………….Full Article: Source

Top ETF and ETP trends through the end of Q3 2013

Posted on 31 October 2013 by VRS  |  Email |Print

Through the end of Q3 2013, the assets in Exchange traded funds (ETFs) and Exchange traded products (ETPs), listed in the United States have increased by 16.1% from $1.35 trillion to $1.56 trillion, representing a new record high.
In addition, through the end of Q3 2013, ETFs/ETPs have seen net inflows of $131.32 billion, which is slightly below the $134.89 billion at the end of Q3 2012. Equity ETFs/ETPs gathered the largest net inflows YTD with $127.28 billion, followed by fixed income ETFs/ETPs with $9.54 billion, while commodity ETFs/ETPs experienced the largest net outflows YTD with $19.49 billion……………………………….Full Article: Source

Five alternative investments for small investors

Posted on 31 October 2013 by VRS  |  Email |Print

Investors are increasingly turning to alternative investing to supplement the lackluster performance of fixed-income securities and find greater returns than equities. With little or no correlation to other assets, alternative investing also provides diversification in a portfolio since it doesn’t always move in tandem with the stock or bond markets.
However there’s a lack of transparency and risk in alternative investments like private equity and hedge funds. Because of these risks, alternative investments are generally limited to institutional investors, endowments or accredited investors who have earned $200,000 annually for the two most recent years or have at least $1 million in equity excluding the value of their home……………………………….Full Article: Source

Chinese financial regulator warming up to commodity options

Posted on 31 October 2013 by VRS  |  Email |Print

China’s financial markets professionals have been facing an ongoing battle from policy makers as the government keeps a Chinese wall from much-needed reforms to compete with international markets. However, in a turn of events the financial watchdog, China Securities Regulatory Commission (CSRC), has hinted that it will be opening up commodity options trading.
In a notification on the regulator’s website, the firm stated that it will be allowing commodity options simulation trading to commence from November 8th. The move comes 12 months after the Dalian Commodity exchange has been exploring simulation trading in options, a common practice among venues prior to the launch of new products or solutions……………………………….Full Article: Source

Barclays reviews foreign exchange trading

Posted on 31 October 2013 by VRS  |  Email |Print

Barclays reported a decline in quarterly profits as it confirmed it was reviewing foreign exchange trading operations in response to an investigation into the $5.3tn market by global regulators.
European lenders UBS and Deutsche Bank on Tuesday admitted their involvement in an international probe into alleged manipulation of currency trading by regulators in the US, UK, Hong Kong and Switzerland……………………………….Full Article: Source

Ex-Noble trader Banga plans commodities splash with Caravel

Posted on 31 October 2013 by VRS  |  Email |Print

Harindarpal “Harry” Banga, a billionaire businessman who carved out a 20-year career at commodities trader Noble, plans a return to the industry in a new trading firm with his two sons.
The 63-year-old former sea captain has amassed a $1 billion (623 million pounds) war chest to splurge on the newly formed Caravel Group while luring 10 to 20 former Noble Group Ltd (NOBG.SI) colleagues to join the venture, sources said. They include former Noble staff in Hong Kong and at its iron ore business in Beijing……………………………….Full Article: Source

Bloomberg Indexes creates new dollar gauge that includes emerging-market currencies

Posted on 31 October 2013 by VRS  |  Email |Print

Bloomberg Indexes introduced a new index on Wednesday to gauge the U.S. dollar’s strength that includes emerging-market currencies like the Chinese offshore renminbi and Mexican peso.
The Bloomberg U.S. Dollar Index contains 10 currencies and is rebalanced every year based on trading and liquidity data. The index has a 34.3% weighting toward the euro , and also consists of the yen , Canadian dollar, pound, Mexican peso, Australian dollar, Swiss franc, South Korean won, Chinese offshore renminbi and Singapore dollar……………………………….Full Article: Source

Carbon bubble? We think not!

Posted on 31 October 2013 by VRS  |  Email |Print

Today we are going to discuss Al Gore and his latest “big idea” as we know we will get emails and comments over the next few days concerning what was said. We will address that story in our comments below, but want to stress to readers that it is important to read those with opposing views when conducting your research in order to complete due diligence.
Most everyone’s thesis for various investment calls is based off of assumptions and it is important to delve into the way those assumptions were arrived at. Simply put we disagree with the former Vice President, but we are thankful for his views as it did give U.S. some insight into the bear case……………………………….Full Article: Source

US and Canadian governors ink ambitious Pacific climate pact

Posted on 31 October 2013 by VRS  |  Email |Print

US and Canadian governors representing 53 million people are joining forces to align their climate and clean energy policies in a move that should further cement the Pacific Coast’s position as one of the world’s leading clean tech hubs.
Yesterday the states of California, Oregon and Washington and the Canadian province of British Columbia signed the Pacific Coast Action Plan on Climate and Energy, which commits the four jurisdictions to “lead national and international policy on climate change”……………………………….Full Article: Source

Bank of Canada: Don’t count on commodity prices for income growth

Posted on 30 October 2013 by VRS  |  Email |Print

Commodity prices may not rise as much as they have in recent years and should therefore not be relied upon for future income growth, Bank of Canada Deputy Governor Agathe Cote said on Tuesday.
“Going forward, productivity may become more crucial to our financial well-being, since real commodity prices, while expected to remain elevated, may not rise as much as they did in the past decade,” Cote said in the prepared text of a speech on “The Promise of Potential.”……………………………………Full Article: Source

Commodities, prices and the crisis after this

Posted on 30 October 2013 by VRS  |  Email |Print

With Syria dominating the headlines commodities, especially oil and gold, are yo-yoing in sync with the news. Though this makes fertile trading ground for short term investors, for long term investors it is harder to separate the “noise” generated by the sabre-rattling from where long term commodities prices could realistically be. What’s the solution?
The last few years have been thick with crises and conflict situations in the Middle East: Syria, Libya, Egypt and Iran, while Europe and the US have dished out their own market-moving contributions in the form of the Greek debt crisis, US debt ceiling negotiations and quantitative easing……………………………………Full Article: Source

Commodity financing in Asia bright spot for banks amid cutbacks

Posted on 30 October 2013 by VRS  |  Email |Print

Booming commodity trade financing in Asia is a rare bright spot for Western banks, forced to withdraw from other areas of commodities due to tougher regulation and capital constraints.
Commodity revenue for banks has shrunk dramatically in recent years and in the first half of 2013, turnover in the sector for the top 10 investment banks slid by about 20 percent to $2.7 billion, according to financial consultancy Coalition…………………………………….Full Article: Source

Goldman Sachs cuts OPEC crude output forecasts for 2013 on Libya

Posted on 30 October 2013 by VRS  |  Email |Print

Goldman Sachs Group Inc. said crude production in the Organization of Petroleum Exporting Countries will decline this year by more than the bank previously estimated because of renewed disruptions in Libya.
OPEC’s output will decline by 760,000 barrels per day from last year, according to the bank, which had previously projected an annual loss of 570,000 a day. The supply reduction will keep Brent futures supported at $110 a barrel despite an accumulation in oil inventories amid weaker-than-expected fuel demand, Goldman said…………………………………….Full Article: Source

OPEC sees no danger to its production plans

Posted on 30 October 2013 by VRS  |  Email |Print

OPEC, the Organization of the Petroleum Exporting Countries, said on Monday there would still be demand for its oil despite the shale oil boom in the United States, downplaying concerns the group may lose its market share.
Boom in shale oil production in the United States has changed the global energy landscape, as Washington has ceded its ranking as top global oil importer to China by cutting its import needs. Next year, the United States is set to overtake Russia as the world’s top oil producer due to the growing non-conventional oil output, the International Energy Agency (IEA) said this month…………………………………….Full Article: Source

Iran skirting oil sanctions

Posted on 30 October 2013 by VRS  |  Email |Print

Iran’s oil minister said that the country has skirted U.S. sanctions by exporting at least one million barrels of crude oil a day, according to regional media reports.
Iranian oil minister Bijan Namdar Zanganeh dubbed U.S. economic sanctions on Iran ineffective during public remarks delivered on Monday and said that the country can be run solely from oil sales…………………………………….Full Article: Source

Oil drops on Libyan export resumption hopes

Posted on 30 October 2013 by VRS  |  Email |Print

Brent oil futures fell on Tuesday, giving back some of the previous session’s sharp gains, on expectations that fresh disruptions over the weekend in exports from OPEC member Libya could be short-lived. Brent rose 2.5 percent on Monday as reports of Libya’s worst civil unrest since the civil war in 2011 fueled concerns over global oil supplies.
The oil market seesawed on varying reports out of Libya. “The Libyan deal is highly fluid,” said Jim Ritterbusch, president of Ritterbusch & Associates in Galena, Illinois. “Yesterday we were looking at production outages, today there’s a renewed upswing in output. It just adds to the volatility.”……………………………………Full Article: Source

Gold fades from investment picture

Posted on 30 October 2013 by VRS  |  Email |Print

The investor gold rush that propelled the precious metal to a dozen years of annual price gains is on the verge of ending with a whimper. Russia’s central bank in September sold gold for the first time in a year, according to the latest data from the International Monetary Fund. Since the start of 2010, Russia has accounted for 30% of all gold purchases made by central banks that report to the IMF.
Like other emerging-market nations, Russia bought gold to diversify its foreign-exchange reserves. The retrenchment of Russia and others is the latest factor to weigh on gold prices, which are down 19% year to date. The last time gold prices posted an annual loss was 2000…………………………………….Full Article: Source

Is it 1982 all over again for gold?

Posted on 30 October 2013 by VRS  |  Email |Print

Despite climbing by more than 10% a year since 1968, bullion has struggled to post anything other than flat returns during 2013. With global growth on the up, it’s hardly surprising that the precious metal has had such a difficult run, but put in its historical context, gold hasn’t performed as badly in more than 30 years, leaving experts wondering whether gold is now looking incredibly cheap.
As pointed out by Adrian Ash, head of research at gold and silver exchange Bullionvault.com, the yellow metal has had an “upside down year”, offering investors little clarity about where gold’s price could be heading next. “Gold in 2013 has done almost exactly the opposite of what it typically does,” he said. “Crashing in spring, and rising sharply in summer, the gold price has reversed what veteran investors call seasonal patterns.”……………………………………Full Article: Source

Silver leads commodity gainers as sentiment improves

Posted on 30 October 2013 by VRS  |  Email |Print

Silver posted the strongest gain of any commodity last week after investors became more confident that the US would leave stimulatory monetary policy in place for the near future.
Data from ETF Securities show the price of silver rose 4.4 per cent in the week ending 25 October, making it the strongest performing commodity of the week. The grey metal is up 5.7 per cent over the past month but is down 24.3 per cent over 2013 so far…………………………………….Full Article: Source

Scrap gold and platinum prices advance, Silver scrap price falls

Posted on 30 October 2013 by VRS  |  Email |Print

The daily scrap gold prices - both hallmarked and non- hallmarked advanced Friday, 25th October on the ScrapMonster Price Index. The prices of Platinum too went higher, but Silver scrap witnessed weakness.
In the Hallmarked category, the 14 carat gold scrap prices were up by $ 3.12 per Oz. The prices of 18 carat and 22 carat gold scrap went higher by $ 4.0 and $ 4.89 per Oz respectively.9 carat gold scrap also quoted higher by $ 2.0 per Oz. The price of Platinum scrap increased by $ 5.10 per Oz. Silver scrap prices were marginally lower by $ 0.26 per Oz…………………………………….Full Article: Source

A better slew of commodity ETPs?

Posted on 30 October 2013 by VRS  |  Email |Print

There is still a good investment case for commodity ETFs but in the current environment of declining prices careful selection of the right ETF is imperative, rather than opting for the simplest basket-only approach. Older generation ETFs have lost their shine of late; no wonder then that a new slew of sleeker, more sophisticated ETPs have been launched that claim to be an improvement on previous ETP structures. Are they right for the times?
Commodity ETFs became very popular with investors during the commodities price boom, attracting everybody from retail buyers to large scale asset allocators…………………………………….Full Article: Source

Oakley Capital said to close fund of hedge funds in commodities

Posted on 30 October 2013 by VRS  |  Email |Print

Oakley Capital Management Ltd. closed its commodities fund of hedge funds as a gauge of performance across the industry retreated for a third year, according to two people with direct knowledge.
The London-based fund shut in July and Portfolio Manager Fabio Cortes left the company at about the same time, said the people, who asked not to be identified because the information is private. The fund managed $10 million of assets, one of the people said. An e-mail seeking comment sent to a LinkedIn Corp. account in Cortes’ name on Oct. 25 wasn’t answered…………………………………….Full Article: Source

Goldman Sachs’ co-head of commodities Shenouda to leave: memo

Posted on 30 October 2013 by VRS  |  Email |Print

The co-head of Goldman Sachs’ global commodities business, Magid Shenouda, is leaving the bank after 14 years, according to an internal memo seen by Reuters on Tuesday.
London-based Shenouda, who has run the commodities business for the past two years alongside New York-based Greg Agran, joined the firm as an executive director in oil trading in 1999, and had run European oil as well as power and gas…………………………………….Full Article: Source

Currencies funds feel strain of US deadlock

Posted on 30 October 2013 by VRS  |  Email |Print

Currencies traders do not know which way to turn. This was meant to be the year the dollar would come roaring back against other major currencies, as the US recovery picked up steam and the Federal Reserve began scaling back its vast stimulus programme.
After years of near-zero interest rates in most developed economies, hedge funds were hoping that divergent central bank policies would finally create clear-cut economic trends on which to trade…………………………………….Full Article: Source

Rough ride in store for EM currencies

Posted on 30 October 2013 by VRS  |  Email |Print

Recent pressure on emerging market currencies has rightfully made headlines. But the broader issue for emerging markets is that such episodes could easily reoccur, or even get worse, over the next few years. This is because, over the past decade, these economies have increasingly pinned their economic hopes to foreign capital flows.
The numbers speak for themselves; portfolio flows to the emerging markets have grown 400 per cent over the past 10 years, compared with nominal GDP growth of 200 per cent. And the same is true of the broader private capital measure, which also includes bank lending and direct investment. This has increased 5.5 times over the same period…………………………………….Full Article: Source

Carbon price an outdated way to cut emissions

Posted on 30 October 2013 by VRS  |  Email |Print

If Labor is really committed to delivering on climate change, then they should be prepared to consider negotiating with the Coalition on repeal of the carbon tax.
Sounds crazy? Not really. Most of the factors that will drive emissions reductions for the rest of the decade are not dependent on a price on carbon. For Labor, staying in the game to get broader energy market reforms is the best way to deliver meaningful action to reduce greenhouse emissions…………………………………….Full Article: Source

Institutional investors concerned about “unburnable carbon” fallout

Posted on 30 October 2013 by VRS  |  Email |Print

The “carbon bubble” is a concept that has been gaining momentum over the past year. In brief, the theory claims that in order to avoid catastrophic climate change, the world must remain within its “carbon budget”—the volume of CO2 that can be emitted before the Earth’s temperature is pushed over the 2°C benchmark agreed upon by the international community.
However, according to the IEA, “no more than one-third of proven reserves of fossil fuels can be consumed prior to?2050 if the world is to achieve the 2°C goal, unless carbon capture and storage (CCS) technology is widely deployed.” Following this theory to its logical end, the remaining two-thirds of global fossil fuel reserves are “unburnable”—that is, worthless…………………………………….Full Article: Source

Fed to outline bank commodity policy early 2014

Posted on 29 October 2013 by VRS  |  Email |Print

The U.S. Federal Reserve may not unveil its plans for regulating Wall Street’s commodity trading business until early next year, a person briefed on the matter said, deferring a decision on the politically fraught debate into 2014.
The timing confounds any expectations that the regulator would make its views known before a second Senate hearing expected next month into the rigging of aluminum and other markets, at which Fed officials are due to testify………………………………………..Full Article: Source

Gold may hit $1400, Brent likely to see $100/bbl: Barratt

Posted on 29 October 2013 by VRS  |  Email |Print

Jonathan Barratt of barrattbulletin.com sees precious metal gold rallying to USD 1400 an ounce. Meanwhile, he remains bearish on Brent crude and expects it to correct to USD 100 per barrel.
If we can stay above USD 1,350 I would be looking for USD 1,375 as the next target and maybe even up to USD 1,400. Crude has been under pressure for sometime and we have seen about a 10 percent correction. So, I would think that we are due for a bounce soon………………………………………..Full Article: Source

Will demand from China continue moving gold and energy assets?

Posted on 29 October 2013 by VRS  |  Email |Print

Economic growth from China is increasing, which is leading to more demand for commodities ranging from gold to oil to natural gas to coal. China is the biggest consumer of energy in the world. It is the second biggest customer for gold, only behind India. Investors ranging from the Central Bank of the Republic of China (in Taiwan) to individuals buy the yellow metal as an asset.
By the fundamentals of supply and demand, China’s growing economy should move the prices of oil, natural gas, coal and gold higher………………………………………..Full Article: Source

The $5 trillion downside to lower oil prices

Posted on 29 October 2013 by VRS  |  Email |Print

If oil prices fall by 25 percent or more, as some analysts predict they will next year, most Americans would cheer. But there’s a downside to $70 a barrel oil: At that price, it would become too expensive to pump the crude out of Texas’ Permian Basin, the second-richest oil field left in the world, thus derailing a $5 trillion energy boom. Joe Carroll and Edward Klump of Bloomberg explain what that means to us.
China’s strong growth is the biggest driver of the world economy right now: If Beijing sneezes, we’re all going to get the fiscal flu………………………………………..Full Article: Source

OPEC sees no danger to its production plans

Posted on 29 October 2013 by VRS  |  Email |Print

OPEC, the Organization of the Petroleum Exporting Countries, said on Monday there would still be demand for its oil despite the shale oil boom in the United States, downplaying concerns the group may lose its market share.
Boom in shale oil production in the United States has changed the global energy landscape, as Washington has ceded its ranking as top global oil importer to China by cutting its import needs. Next year, the United States is set to overtake Russia as the world’s top oil producer due to the growing non-conventional oil output, the International Energy Agency (IEA) said this month………………………………………..Full Article: Source

IEA: September OPEC oil supplies slip below 30 mln b/d

Posted on 29 October 2013 by VRS  |  Email |Print

Due to lower output from Iraq and Libya, crude oil supplies from the Organization of Petroleum Exporting Countries in September fell by 645,000 b/d to 29.99 million b/d, below the 30 million b/d threshold for the first time in almost 2 years, according to the International Energy Agency’s most recent Oil Market Report.
Non-OPEC supplies, after falling in August, inched up in September by 20,000 b/d to 54.61 million b/d, which is still significantly lower than July levels. As the steep fall in OPEC crude oil production only partially offset by the marginal increase in non-OPEC supplies, global oil supplies in September fell to 91.12 million b/d from 91.74 million b/d in August………………………………………..Full Article: Source

Why China is set to drive gold prices skywards

Posted on 29 October 2013 by VRS  |  Email |Print

The strength of gold bar, coin and jewellery demand across Asia helped gold to rebound from three-year troughs below $1,200 in the summer. Looking further ahead, in my opinion the prospect of accelerating physical demand from these regions — and in particular China — combined with enduring difficulties in the world economy, provide the perfect melting pot for gold to rise strongly.
And if, like me, you believe that gold is ready to stage another surge to the upside, in my opinion SPDR Gold Trust and Gold Bullion Securities are an excellent way to pocket gold-lined gains. These exchange-traded funds (ETFs) are designed to follow movements in the metal price………………………………………..Full Article: Source

Russia reduces gold holdings for first time in a year

Posted on 29 October 2013 by VRS  |  Email |Print

Russia reduced gold reserves for the first time in a year in September as Mexico cut holdings for a 17th straight month, according to the International Monetary Fund. Kazakhstan expanded assets for a 12th month.
Reserves in Russia declined about 0.37 metric ton to 1,015.1 tons, data on the IMF’s website showed. Kazakhstan’s holdings expanded 2.52 tons to 137.04 tons, the data showed………………………………………..Full Article: Source

Why the gold price and stock markets are disconnecting

Posted on 29 October 2013 by VRS  |  Email |Print

The gold price consolidated recent gains on Monday holding firm above the key $1,350 an ounce level it scaled last week to reach a five-week high. In late afternoon trade on the Comex market in New York December gold futures changed hands at $1,353.60, a slight gain on Monday’s close, but off its highs for the day of $1,362.
The price of gold has rallied sharply from the intra-day low of $1,182.60 an ounce hit on June 28, but remains down 19% for the year………………………………………..Full Article: Source

Indian gold demand soldiers on despite govt intervention - UBS

Posted on 29 October 2013 by VRS  |  Email |Print

The line between investment and jewellery demand within India is often decidedly blurry. This is one of the many reasons why the Indian government’s quest to rein in gold imports is rather quixotic and, it begs the question, how sustainable is the current regulatory framework?
In its daily precious metals note, UBS asks exactly that, commenting that, while the situation is fluid, “There is a clear recognition of the reality that a decent portion of demand – particularly in the form of jewellery and ornaments linked to festivals and wedding traditions – will remain intact.”……………………………………….Full Article: Source

Copper market: Place not too much trust on China

Posted on 29 October 2013 by VRS  |  Email |Print

China accounts for about 40% of the global copper consumption and hence has a great influence on prices. China refined copper consumption rose to record levels in September and a modest uptick in sHFE stocks may suggest a supply surplus dynamics evolving, according to Barclays Research.
The critical question for the copper market and price performance is whether the strength of September’s apparent consumption can be sustained into Q4 2013. From a refined production perspective, September’s 45% y/y surge in copper concentrate imports, surpassing 1Mt to a new record, would suggest support for continuation of this trend………………………………………..Full Article: Source

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