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Commodities Briefing - Archive | August, 2016

Biggest African Economies Stall on Politics, Commodity Slump

Posted on 31 August 2016 by VRS  |  Email |Print

Africa’s two largest economies are stalling amid slumping commodity prices and political infighting that’s hampering decision making. A government report on Wednesday will probably show Nigeria contracted for a second consecutive quarter in the three months through June as the price and output of oil, its main source of revenue, were squeezed.
While South Africa may have avoided falling into a recession, according to the median estimate of five economists surveyed by Bloomberg, the continent’s most-industrialized economy will not grow this year, the nation’s central bank said last month……………………………………….Full Article: Source

Commodity market bullish, but manufacturing demand may take more time to improve

Posted on 31 August 2016 by VRS  |  Email |Print

The current scene in the commodity market can best be termed as a bit bullish. Production is rising in response to a certain surge in demand. Good monsoon is likely to enliven the agriculture sector and with that the increase in rural income is to translate into higher growth in demand for consumer goods and houses.
The commodity prices are indeed moving up, but not uniformly across all products. From the next month onwards with the additional income in the hands of government employees, the boost in demand for household goods, real estate, automobile and travel would benefit these segments a great deal. The incoming festive seasons would only contribute positively……………………………………….Full Article: Source

Commodities struggle and oil declined - ANZ

Posted on 31 August 2016 by VRS  |  Email |Print

Analysts at ANZ explained that commodities struggled as a stronger USD and weak fundamentals saw investor appetite wane. Oil declined as doubts emerged that producers will agree to a production freeze.
“The UAE oil minister hinted that the oil market should achieve stability soon. According to reports on Bloomberg, Iran also reiterated it wouldn’t participate in a freeze in output until it regained its share of OPEC production seen three years ago. The physical iron ore market remained quiet, with prices relatively unchanged……………………………………….Full Article: Source

CEO of global energy firm is not ruling out an oil price surge to $100

Posted on 31 August 2016 by VRS  |  Email |Print

Global oil markets could see an increased risk of another major jolt if prices continue to remain at current levels, Tom Albanese, the chief executive of Vedanta Resources told CNBC Tuesday. Recent reports show that discoveries of new oil reserves have dropped to their lowest level for more than 60 years.
The chief of one of the world’s largest diversified natural resources companies implied that this could potentially cause supply shortages. “People are saying there’s no such thing as $100 oil coming again but the longer the prices stay low for this period of time you could see increased risk of a price shock coming in the future,” Albanese said……………………………………….Full Article: Source

Why Oil Market Bulls May Be Misguided

Posted on 31 August 2016 by VRS  |  Email |Print

The dollar strengthened and stocks in Europe and Asia mostly gained as investors continued to digest recent comments from Federal Reserve officials on the prospects for a U.S. interest rate increase this year.
The WSJ Dollar Index, which measures the greenback against a basket of 16 currencies, rose 0.2% Tuesday, putting it on track for its third consecutive session of gains. Higher interest rates tend to make a currency more attractive to investors seeking returns……………………………………….Full Article: Source

Oil executives say crude market volatility is here to stay

Posted on 31 August 2016 by VRS  |  Email |Print

Crude markets will continue to be plagued by volatility in the short and medium term after suffering the biggest downturn in a generation over the past two years, according to oil-company executives gathering for one of the industry’s biggest conferences in Norway.
Oil declined on Monday amid doubts producers will agree on a deal to stabilise the market when suppliers meet next month for informal talks. Iran’s plan to continue boosting crude output until it regains its pre-sanctions Opec market share is dimming prospects of collective action, according to Patrick Allman-Ward, the chief executive of Sharjah’s Dana Gas, at the ONS conference in Stavangar, Norway……………………………………….Full Article: Source

India to be hit by economic crisis if oil price crosses $60: Subramanian Swamy

Posted on 31 August 2016 by VRS  |  Email |Print

India will be hit by an economic crisis if crude oil price crosses USD 60 per barrel, BJP MP Subramanian Swamy said. “Given the state of our economy, if crude oil price per barrel rises above $60 then we will be hit by an economic crisis,” he tweeted.
US benchmark West Texas Intermediate is trading around $47 per barrel while Brent is at $49 currently. The slump in oil prices last year is one of the factors that helped Indian economy notch up big gains by cutting its import bill and reining in inflation……………………………………….Full Article: Source

Iraq to support oil output freeze at OPEC meeting: PM

Posted on 31 August 2016 by VRS  |  Email |Print

Iraq would support a decision by OPEC to freeze oil output to prop up prices, Iraqi Prime Minister Haider al-Abadi told a news conference in Baghdad on Tuesday. “We are with freezing production at the OPEC meeting,” he said, in the clearest indication yet about the position Iraq will support when the oil exporters’ group meets next month.
Members of the Organization of the Petroleum Exporting Countries are due to meet informally in Algeria on the sidelines of the International Energy Forum (IEF) on Sept. 26-28……………………………………….Full Article: Source

Central Bankers Get Tired of Gold as Lower Exports Cut Cash

Posted on 31 August 2016 by VRS  |  Email |Print

The biggest owners of gold are tiring of the metal. Central banks — holders of about 32,900 metric tons of bullion — cut their purchases by 40 percent during the three months through June, compared with the same period a year earlier, to the lowest since 2011, World Gold Council figures compiled by Bloomberg show. It was the third-straight quarterly drop, the longest such streak in at least five years.
Buying declined in 2016 as prices were rallying for their biggest first-half gain in 40 years……………………………………….Full Article: Source

Why Gold Will Likely Be Much Higher 10 Years From Now

Posted on 31 August 2016 by VRS  |  Email |Print

US government debt should exceed $20 trillion next year. Domestic infrastructure is falling apart and more spending (debt) is badly needed. The Federal Reserve will not be able to significantly raise interest rates due to a systemically weak US economy which is likely to stay “weaker for longer.”
Low and even negative interest rates mean the cost of buying and holding gold is negligible. Long term, gold is going much, much higher. Many goldbugs and analysts watch the price of gold very closely and try to time trades based on the latest economic data or Federal Reserve statements……………………………………….Full Article: Source

Gold futures may climb toward $1,400 by end of year: analyst

Posted on 31 August 2016 by VRS  |  Email |Print

Gold futures still have room to climb this year even as the Federal Reserve seesaws between a dovish and hawkish stance on monetary policy. Prices for the yellow metal may make “another try” at the $1,400-an-ounce level later this year, George Milling-Stanley, head of gold investment strategy at State Street Global Advisors, said.
He said he can’t guarantee a rate increase at all, with the Fed appearing to be “dovish one day and hawish another” day. He expects gold to see muted trading for the rest of the year but despite that, prices may still see another $50, $60 or $70 rise. Also on CNBC, Tom McClellan, editor of The McClellan Market Report, said next year and 2018 should be “hugely bullish” for gold……………………………………….Full Article: Source

Are gold and silver still trending up?

Posted on 31 August 2016 by VRS  |  Email |Print

The demand for gold investments reached a record 1,064 tonnes in 1H. This is the highest 1H demand since 2009, when the financial market was reeling from the global financial crisis. Are gold investors preparing for the next crisis?
The demand from gold comes from four main sources: jewellery, technology, investment, and reserve asset management. Of the four, jewellery demand accounted over half of total gold demand. But anaemic jewellery demand amid high prices has eroded the demand share since 2006……………………………………….Full Article: Source

Base metals in “wait-and-see” mode ahead of China’s PMIs

Posted on 31 August 2016 by VRS  |  Email |Print

Base metals were under selling pressure last week with the exception of zinc and tin, which managed to set fresh year-to-date highs. Copper fell the most, down nearly four percent week-on-week, amid tangible signs of fundamental weakness combined with an unfriendly macro.
Precious metals also were weaker last week, with gold dropping the most, down 1.5 percent week-on-week, largely attributable to hawkish statements from Fed members and encouraging US macro data releases, prompting the market to reprice upwardly the path of Fed funds rates……………………………………….Full Article: Source

Brexit Blows Up Currency Derivatives Sold to U.K. Companies

Posted on 31 August 2016 by VRS  |  Email |Print

For eight years, TTT Moneycorp Ltd. regularly took Dariusz Suchicki to dinner and soccer matches, all while selling him, as the head of finance of a U.K.-based importer of Polish foods, a series of complex currency derivatives.
When the pound started moving sharply against the zloty, those instruments became toxic: They began costing Suchicki’s company, Best Foods, tens of thousands of pounds a month, the company said in court filings last year……………………………………….Full Article: Source

Japan: Finance Ministry vs. the currency speculators

Posted on 31 August 2016 by VRS  |  Email |Print

With Japan’s economy struggling to escape its deflationary torpor, the economic-revitalization plan that Prime Minister Shinzo Abe launched in 2012 has come under growing scrutiny. But Japan’s current travails, which have brought a concomitant decline in Japan’s stock market, stem from the yen’s appreciation — 24 percent over the last year — against major currencies.
Abenomics — which included substantial monetary and fiscal expansion — has nothing to do with it. Since Abenomics was introduced, Japan’s labor market has improved considerably: 1.5 million new jobs have been created, and the unemployment rate has fallen to just over 3 percent……………………………………….Full Article: Source

Seven steps to smarter carbon policy

Posted on 31 August 2016 by VRS  |  Email |Print

As the Australian Parliament reconvenes, it’s timely to reassess the scope for Australia to establish a clear, enduring path to efficiently meet its current and future carbon targets. This week, the Energy Networks Association (ENA) released a final report by Jacobs analysing alternate options for carbon policy in Australia.
The analysis has informed ENA’s publication, Enabling Australia’s Cleaner Energy Transition, which proposes seven steps to smarter carbon policy. The Jacobs analysis evaluated three different policy settings for achieving the current Australian abatement target (26 to 28% below 2005 levels by 2030)………………………………………Full Article: Source

The Swedish Tycoon Hunting for Commodities Says He Makes His Own Luck

Posted on 30 August 2016 by VRS  |  Email |Print

If Monopoly were played for natural resources, Lukas Lundin would be the natty gent in the tuxedo - riding a motorcycle. And like many with a knack for the board game, the Swedish-Canadian tycoon says his victories are as much about guts as a good roll of the dice. “You make your own luck,” the 58-year-old Lundin said in an interview at his Vancouver offices last week. “If you sit at home, you’re never going to get the luck.”
No one could accuse Lundin of lazing around the house. He and his younger brother, Ian Lundin, oversee a family fortune estimated to be worth at least $2.5 billion, according to the Bloomberg Billionaires Index, a number Lundin said is about right………………………………………..Full Article: Source

Southeast Asia to lead charge in commodities as China’s economy slows

Posted on 30 August 2016 by VRS  |  Email |Print

China may be slowing, but a commodities rebound is under way and the world’s biggest miner knows where the next growth story is building - emerging economies in Southeast Asia.
Combined gross domestic product in the ASEAN-5 nations - Indonesia, Thailand, Malaysia, the Philippines and Vietnam - will rise about a third to US$3 trillion in the five years to 2020, fueling commodities-intensive infrastructure projects. Momentum like this across Asia will help maintain and increase commodity demand, BHP Billiton Ltd.’s Chief Executive Officer Andrew Mackenzie said this week………………………………………..Full Article: Source

Commodity pricing divergence calls for ‘discerning and tactical’ investors now that it’s tougher to pick winners

Posted on 30 August 2016 by VRS  |  Email |Print

During the commodity bull market from 2002 to 2011, it was almost impossible not to make money in this space. The price of nearly every energy, metal and agricultural commodity dramatically rose, driven by China’s massive economic growth.
Some performed better than others, of course, but the proverbial monkey with a dartboard could pick winners as well as many humans did. It was just the opposite from 2012 to early 2016. There was nowhere to hide in this period as commodities got mashed. They didn’t all drop at once, but they ended up in the same gutter by early 2016………………………………………..Full Article: Source

Oil market rebalancing could take until end 2017: Shell

Posted on 30 August 2016 by VRS  |  Email |Print

The huge global oil oversupply that has weighed on prices for the past two years may not clear until the second half of 2017, Shell’s chief energy adviser Wim Thomas told Reuters.
The potential return to the market of some 1.5 million barrels per day of supply from Libya and Nigeria and uncertainty about Iranian and Iraqi production levels could push a rebalancing further away than many in the oil industry are hoping. “All these things when they come back on the market can again postpone the true balancing,” Thomas said in an interview on the sidelines of the ONS oil conference in Stavanger, Norway………………………………………..Full Article: Source

Oil prices are poised for a 2010-style rally, says BofA Merrill Lynch analyst

Posted on 30 August 2016 by VRS  |  Email |Print

Crude prices could rise to as much at $70 a barrel during the peak summer driving season next year as the oil market swings from a surplus to a significant deficit, said Francisco Blanch, head of global commodities and derivatives research at Bank of America Merrill Lynch.
In recent weeks traders have been hanging on every word from ministers of petro-states after officials confirmed earlier this month they would speak on the sidelines of the International Energy Forum next month about taking measures to prop up oil prices………………………………………..Full Article: Source

OPEC revenue to plunge further to $341 billion in 2016

Posted on 30 August 2016 by VRS  |  Email |Print

Based on United States (U.S.) Energy Information Administration (EIA) price forecasts, revenue of members of the Organisation of the Petroleum Exporting Countries (OPEC), is expected to fall to $341 billion in 2016.
The agency, which believed that the revenue could still increase to $427 billion in 2017, put the cartels earnings in 2015 at $404 billion in net oil export revenue in 2015, representing a 46 per cent decline from $753 billion earned in 2014………………………………………..Full Article: Source

Gold ‘should be $US1,700 an ounce’: Deutsche Bank

Posted on 30 August 2016 by VRS  |  Email |Print

Gold has seen a sell-off in recent days, heading for the longest run of declines since May, trading at $US1319 an ounce. Federal Reserve chairwoman Janet Yellen’s speech at Jackson Hole over the weekend contributed to gold’s latest decline.
Yellen said the case for a US rate increase has strengthened, without specifying whether we would see one in September or ­December. The odds of a September rate rise have risen to 42 per cent, from 22 per cent a week ago, and the odds of a December rate hike soared to 65 per cent, according to Bloomberg………………………………………..Full Article: Source

Why Gold Will Likely Be Much Higher 10 Years From Now

Posted on 30 August 2016 by VRS  |  Email |Print

US government debt should exceed $20 trillion next year. Domestic infrastructure is falling apart and more spending (debt) is badly needed. The Federal Reserve will not be able to significantly raise interest rates due to a systemically weak US economy which is likely to stay “weaker for longer.”
Low and even negative interest rates mean the cost of buying and holding gold is negligible. Long term, gold is going much, much higher………………………………………..Full Article: Source

The Gold Trade Is Not Overcrowded Says UBS

Posted on 30 August 2016 by VRS  |  Email |Print

The best performing precious metal for the week was gold, down slightly by 1.47 percent. Current market conditions make it the perfect time to invest in gold, according to Heather Ferguson, an analyst at Hargreaves Landsown.
“There is a fixed amount of this precious metal in the world so central banks are not able to manipulate the gold market like they can with bonds and cash,” Ferguson explains. “In the current environment of quantitative easing and increasingly extreme monetary policy, gold is highly sought after.”……………………………………….Full Article: Source

Price of Silver Soars 45% in H1 2016

Posted on 30 August 2016 by VRS  |  Email |Print

Silver’s price performance soared in the first half of 2016, fueled by increased investor interest in silver as a safe haven asset and as leveraged exposure to gold’s price rally. Between January 4 to July 11, the price of silver increased 44.7%, according to a report by the Silver Institute.
Exchange traded product holdings rose by 44.3 million ounces (Moz), or 7.2%, to a record high of 662.2 Moz. Silver coin sales increased in the first quarter of 2016 by 29% globally, according to the GFMS Thomson Reuters Quarterly Coin Sales Survey………………………………………..Full Article: Source

Manganese ore CIF China price halts uptrend after silicomanganese slides

Posted on 30 August 2016 by VRS  |  Email |Print

CIF China manganese ore prices for the first time in weeks halted an uptrend, after the rally in domestic silicomanganese ended and prices took a downturn. The S&P Global Platts weekly assessment for 44% ores was stable week on week last Friday, at $4.4/dmtu CIF Tianjin, while 37% manganese ores was also unchanged over the same period at $3.7/dmtu CIF Tianjin.
Trading activity was thin last week, according to market participants. “It’s quiet, most people are sold out for the month of September by now, and it’s too early for October prices,” a producer said, adding that offers for October would likely be announced in the first week of September………………………………………..Full Article: Source

Hedge funds bail on copper as Goldman sees ‘supply storm’

Posted on 30 August 2016 by VRS  |  Email |Print

Copper is stuck in a rut. While other metals have shined in 2016, copper has struggled to gain traction and last week erased its gains for the year. Demand in China, the world’s biggest user, is slowing just as Goldman Sachs Group predicts a “supply storm” will hit the market and drag prices even lower.
Stockpiles of the metal are ballooning, further pointing to a demand slowdown. Inventories monitored by the London Metal Exchange have jumped to a ten-month high. Supplies are likely moving out of China and into warehouses tracked by the LME, Commerzbank said in a report August 24. ……………………………………….Full Article: Source

Assets Invested in ETFs/ETPs In Canada Reached Record $81 Billion By July 2016

Posted on 30 August 2016 by VRS  |  Email |Print

ETFGI, the leading independent research and consultancy firm on trends in the global ETF/ETP ecosystem, reported assets invested in ETFs/ETPs listed in Canada have increased 25.3% year to date to reach a new record of US$81 billion at the end of July 2016. The Canadian ETF industry had 430 ETFs, with 585 listings, assets of US$81 Bn, from 17 providers listed on 2 exchanges, according to ETFGI’s July 2016 global ETF and ETP industry insights report.
Record levels of assets were also reached at the end of July for ETFs/ETPs listed globally at US$3.343 trillion, in the United States at US$2.367 trillion, in Europe at US$539.16 Bn and in Japan at US$191.82 Bn. ……………………………………….Full Article: Source

The 5 Best Oil ETFs

Posted on 30 August 2016 by VRS  |  Email |Print

These 5 oil ETFs offer investors an opportunity to speculate on oil futures, E&P stocks large and small, and services companies that are especially leveraged to changes in drilling activity.
An explosion in ETFs has left investors with so many choices that it’s difficult to separate the best ETFs from the worst. I’ve taken a deep look into many oil exchange-traded funds on the market and determined that these five are my picks for the top funds for oil investors and speculators alike………………………………………..Full Article: Source

2016’s Best-Performing Commodity ETFs Could See Gains Evaporate Soon

Posted on 30 August 2016 by VRS  |  Email |Print

With great gains come great risk, and a number of high-flying commodity ETFs are now facing big potential pullbacks, as the odds of an interest rate hike rise. As a result, investors sitting on big gains could very well see them go up in smoke soon. Let’s take a look at some of the most at-risk precious metal and commodity ETFs.
Clearly, the GDXJ and GDX are particularly vulnerable here. Both gold miner-focused ETFs have been on incredible runs in 2016, and despite cooling off this month, they lack any major technical price support to help prevent further pullbacks………………………………………..Full Article: Source

Why currency traders can’t lose in the $5.3 trillion-a-day global currency market

Posted on 30 August 2016 by VRS  |  Email |Print

For just the second time in the past decade, three major foreign-exchange trading strategies are all producing positive returns. The carry trade, in which investors borrow in Group of 10 currencies with low interest rates and use the proceeds to buy assets with higher yields, is on pace for its biggest annual gain since 2012, according to Deutsche Bank AG index data.
Trades that buy undervalued currencies and sell expensive ones, and tactics that latch onto foreign-exchange trends, are also making money. Choosing the correct foreign-exchange strategy has become even more important in a world of unprecedented central-bank monetary stimulus and currencies linked to historically low interest rates………………………………………..Full Article: Source

Currency swap between South Korea and Japan

Posted on 30 August 2016 by VRS  |  Email |Print

The currency swap between South Korea and Japan will likely resume in the coming months as the two countries’ finance ministers reached a consensus on Saturday to promptly start negotiations on the bilateral financial pact.
The two countries’ previous currency swap deal expired in February 2015. The new swap is designed to prepare for currency volatility arising from negative external factors - effectively acting as a buffer against sharp currency swings. A currency swap is an accord between two parties to exchange one currency for another at a specific rate in a bid to use the foreign currency to ease volatility in the market………………………………………..Full Article: Source

To Stop Climate Change, Don’t Just Cut Carbon

Posted on 30 August 2016 by VRS  |  Email |Print

This year’s Democratic platform has the fingerprints of progressive movements all over it. A $15 minimum wage, a pathway to cannabis legalization, improvements to Social Security, police accountability, and financial reforms — including a tax on speculation — all make an appearance.
The platform also highlights the critical link between climate and the economy. In particular, it argues that “carbon dioxide, methane, and other greenhouse gases should be priced to reflect their negative externalities.”……………………………………….Full Article: Source

G20: Seven steps to sustained economic growth

Posted on 30 August 2016 by VRS  |  Email |Print

The International Chamber of Commerce has put forward a set of business recommendations to help leaders of the world’s major economies prepare for discussions on the world’s most pressing economic policy challenges at next month’s G20 Summit taking place Hangzhou, China.
From climate change and energy to taxation and trade, the recommendations cover seven areas not covered by the 20 principle 2016 policy recommendations developed by the Business -20 (B20), and to which ICC significantly contributed and fully endorses………………………………………..Full Article: Source

1 Fact and 2 Forecasts for the Global Economy

Posted on 30 August 2016 by VRS  |  Email |Print

Global economic growth is slowing. The world economy continues to expand, but at a smaller growth rate than in recent years. The outlook isn’t much better. In fact, the IMF keeps revising its forecast downwards, as do the forecasters tracked by FocusEconomics.
It turns out that the expected growth isn’t much off than the historical average. Advanced economies are will not accelerate from current tepid growth, but emerging economies will gradually improve………………………………………..Full Article: Source

Mitsubishi Sees Three Years Needed for Shift From Commodities

Posted on 29 August 2016 by VRS  |  Email |Print

Japan’s biggest-trading house has had its fill of commodities. After posting the first annual loss in its post-World War II history amid the collapse in commodity prices, Mitsubishi Corp. is shifting away from raw materials to make sure it never happens again. That process is going to take at least three years, according to Chief Financial Officer Kazuyuki Masu.
“We can’t post a second net loss,” Masu said in an interview in Tokyo. “We are balancing our portfolio so that if the price of resources fall again, we won’t be seeing red. To put it simply, we aren’t going to boost our current balance of resources assets” over the next three years………………………………………..Full Article: Source

Commodities Are the Best Bargain Now: Here’s What to Buy

Posted on 29 August 2016 by VRS  |  Email |Print

What kind of investor are you? Are you the buy-high-sell-higher (trend continuation) type? Or are you a bargain hunter who likes beaten-down (trend reversal) opportunities? The former type of investor is now in heaven. With the stock market at new highs, there are many stocks on fire.
But if you’re looking for bargains, the pickings are pretty slim. Don’t worry. There are still many places to invest your money. I’m talking about hard assets, aka commodities. Hard assets go well beyond real estate and gold. They include all types of natural resources like oil, wheat, copper, timber, coffee, zinc, and pork bellies………………………………………..Full Article: Source

Commodity Prices And The Fed: What’s Happening Man?

Posted on 29 August 2016 by VRS  |  Email |Print

Markets went up on Janet Yellen’s speech yesterday, and then went down on Stanley Fischer’s clarification of Janet Yellen’s speech. The stock market and the commodities market acted like “asset bubble” markets yesterday and reflect how dependent the markets are on Federal Reserve support.
The Fed will probably not raise its policy rate in September; its officials are not ready for an increase and the Fed, usually, does not move just before an election. The headlines on the front page of the Wall Street Journal, front and center, read “Yellen Sends Strong Signal on Rates.”……………………………………….Full Article: Source

Oil Market Pessimists Exit as OPEC Talk Spurs Bets Glut Easing

Posted on 29 August 2016 by VRS  |  Email |Print

Oil investors are turning the car around. For a second week, money managers slashed bets on falling prices by a record and boosted wagers on a rally. Futures have climbed 23 percent in less than three weeks as some OPEC members raised the possibility of an output freeze amid signs the global glut is easing.
“This is a lot of running from one side of the boat to the other,” said Tim Evans, an energy analyst at Citi Futures Perspective in New York. “Speculators were selling with both hands in July and buying with both hands this month.”……………………………………….Full Article: Source

Saudi energy minister: Oil market ‘moving in the right direction’

Posted on 29 August 2016 by VRS  |  Email |Print

Saudi Arabian Energy Minister Khalid Al-Falih tempered expectations that the world’s major oil producers would look to freeze production next month, telling Reuters last week that the “market is moving in the right direction” already. “We don’t believe any significant intervention in the market is necessary other than to allow the forces of supply and demand to do the work for us,” he said.
Al-Falih said there have not yet been any specific discussions of a production freeze by OPEC, even though world supply remains high. His comments suggest the chances of a pact are minimal, as he pointed to a market rebalancing and steady demand………………………………………..Full Article: Source

Iran and Venezuela cooperate to boost oil prices

Posted on 29 August 2016 by VRS  |  Email |Print

Venezuela’s president said he expects new measures to stabalise oil markets and strengthen OPEC to be announced soon. Nicolas Maduro was meeting with Iran’s foreign minister and said the two nations agreed to cooperate to boost oil prices.
“We continue to build common ground and a new consensus on stabilising oil markets, strengthening industries, strengthening OPEC, to strengthen the closeness and alliance with the production countries of OPEC,” said Maduro in a televised address………………………………………..Full Article: Source

Iraq Can Crush OPEC’s Oil Freeze Believers

Posted on 29 August 2016 by VRS  |  Email |Print

When the OPEC nations last met with Russia to agree an output freeze, back in April, it was Saudi Arabia that shot down the deal — refusing to take part without Iran. This time both countries may be more accommodating; the stumbling block is more likely to be Iraq.
OPEC members are planning an informal meeting in Algeria in late September, where discussions of a freeze could be revived. In April, the Saudis refused to limit output unless Iran did the same. Not surprisingly, as it was still raising production after the easing of sanctions, Iran refused and the Saudis walked away………………………………………..Full Article: Source

OPEC’s market share at a good level, says UAE energy minister

Posted on 29 August 2016 by VRS  |  Email |Print

OPEC’s share of the oil market is at a good level, UAE energy minister Suhail Bin Mohammed al-Mazroui said as the producer group continues to contend with low crude prices. “Regardless of the different views on the oil market, we see that the OPEC current market share is at a good level,” Mazroui said on his official Twitter account on Saturday.
Mazroui also said he believed that any future decision on oil production would require full participation from all members of the Organization of the Petroleum Exporting Countries plus other major producers………………………………………..Full Article: Source

Higher gold price will add 10m annual ounces by 2020

Posted on 29 August 2016 by VRS  |  Email |Print

BMI Research, a division of Fitch, predicts in a new report that gold miners will add 10 million ounces or more than 280 tonnes to global production with average annual growth of 2.7% for a total of 110 million ounces or 3,118 tonnes yearly output by 2020. This represents a slight deceleration in growth rate compared the previous five-year average of 3.2%.
Projects expected to add substantial ounces to global gold production before the end of the decade include Endeavour Mining’s Hounde project in Burkina Faso, Goldcorp and Teck’s Corridor JV in Chile and Torex Gold Resources giant El-Limon-Guajes ramp up to full production………………………………………..Full Article: Source

Gold May Have ‘Rally Legs’ - RBC’s Gero

Posted on 29 August 2016 by VRS  |  Email |Print

“As more things change the more they stay the same,” summed up George Gero of RBC Wealth Management, post Fed Chair Janet Yellen’s anticipated talk. Federal Reserve chair Janet Yellen said Friday that there is a stronger case for a rate hike with the U.S. economy nearing goals of maximum employment and price stability.
Yellen’s Jackson Hole speech was slightly hawkish, said Gero but seems to be helping the metals as ten-year treasuries and the dollar index are back to where they were. Gold dipped on the news but is now 1.5% higher post-remarks. December Comex gold futures last traded at $1,343.40 an ounce while September silver last traded at $18.950, 2.49% on the day………………………………………..Full Article: Source

Gold price drops, but market watchers remain bullish

Posted on 29 August 2016 by VRS  |  Email |Print

The gold price is heading for its first monthly drop since May as the spotlight refocuses on the next United States interest rate hike. But market watchers are still bullish on the precious metal given its safe-haven qualities amid continuing global economic uncertainty.
The gold price - about US$1,325 an ounce as at last Friday - is down 0.8 per cent this month, as the commodity retreats from its high this year of US$1,373 in early July following Britain’s shock vote to leave the European Union………………………………………..Full Article: Source

What next for gold prices?

Posted on 29 August 2016 by VRS  |  Email |Print

Gold was a disaster after it peaked at $1,930 an ounce in September 2011 and then dropped to $1050 in a savage bear market that mauled the gnomes and goldbugs of the Gulf.
However, the yellow metal endeared a bull market in 2016 as gold bullion has risen 24 per cent while the gold miners index fund (GDX) I had recommended in this column has been one of the most profitable investments of 2016, up a fabulous 100 per cent. Gold is $1,325 spot as I write. What next?……………………………………….Full Article: Source

Zinc lifts to 15-month high

Posted on 29 August 2016 by VRS  |  Email |Print

Zinc has hit its highest in 15 months as bearish speculators scrambled to close out positions, though some investors doubt that the hefty gains are entirely justified. Volumes were huge, with zinc turnover on the London Metal Exchange (LME) of more than 17,000 lots, more than double the activity in aluminium, one of the most active contracts.
“Shorts had been building up recently because people were expecting a setback lower, but when stops were triggered, that forced the shorts to cover,” said Gianclaudio Torlizzi, Partner at the T-Commodity consultancy in Milan………………………………………..Full Article: Source

Hedge Funds Bail on Copper as Goldman Predicts ‘Supply Storm’

Posted on 29 August 2016 by VRS  |  Email |Print

Copper is stuck in a rut. While other metals have shined in 2016, copper has struggled to gain traction and last week erased its gains for the year. Demand in China, the world’s biggest user, is slowing just as Goldman Sachs Group Inc. predicts a “supply storm” will hit the market and drag prices even lower.
Stockpiles of the metal are ballooning, further pointing to a demand slowdown. Inventories monitored by the London Metal Exchange have jumped to a 10-month high. Supplies are likely moving out of China and into warehouses tracked by the LME, Commerzbank AG said in a report Aug. 24. The hoard underscores why money managers are betting on more price declines………………………………………..Full Article: Source

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