Energy Commodities Retreated, Precious Metals Gain Strength

Highlights:

• ENERGY:
  Brent crude futures were trading with a decrease of 0.98% or 83 cents, at $ 84.24 a barrel.
  WTI futures slipped by 0.82% or 68 cents to $82.28 a barrel.
  Natural gas futures for December delivery were trading with a loss of 0.21% or $0.011 at $5.339. 
• METALS:
  Gold futures for December delivery increased by $13.80 at $1,784.20. Meanwhile, Comex Silver futures for December delivery advanced by $0.202 at $24.10 an ounce.
• AGRICULTURAL:
  The price of soybeans rose by 1.48% to $458.
  

Crude oil dropped after China’s intervention

Crude prices fell on Wednesday after the Chinese government stepped up efforts to cut record coal prices and ensure mines are operating at full capacity in a bid to ease the energy crisis.

Brent crude futures were trading with a decrease of 0.98% or 83 cents, at $ 84.24 a barrel.

WTI futures slipped by 0.82% or 68 cents to $82.28 a barrel. 

China is preparing to take steps to combat sharp increases in the domestic coal market. It could put considerable pressure on the price of coal. 

Chinese coal and other commodity prices plummeted, also pushing crude from its bullish price earlier in the day. Meanwhile, the global coal and gas crisis supports oil markets. 

However, the market was also pressured by data from the American Petroleum Institute, showing that crude inventories in the US expanded by 3.3 million barrels for the week ended October 15. This figure was well above 1.9 million barrels expected by analysts. 

Natural gas futures slipped 

US natural gas futures declined early Wednesday, after a potentially bullish technical turn in the previous session. 

Natural gas futures for December delivery were trading with a loss of 0.21% or $0.011 at $5.339. 

According to Natural Gas Intelligence, the bulls got some support from the latest production figures. Bloomberg data showed that production had fallen by more than 2 Bcf a day, slightly below 90 Bcf. Wood Mackenzie also estimated a lower production but placed the official count at around 91 Bcf.

Inflation worries support gold and silver

Inflation worries are prompting investors to buy an interest in precious metals. 

Gold futures for December delivery increased by $13.80 at $1,784.20. Meanwhile, Comex Silver futures for December delivery advanced by $0.202 at $24.10 an ounce.

Analyst Patrick A. Heller stated that there are many reasons to expect gold and silver prices to be much higher in the long run than they are today. First, gold and silver are traditional safe-haven assets that protect against the decline and collapse of fiat currencies. Also, almost all governments and central banks have abandoned any pretense of fiscal stability. Meanwhile, the values ​​of other financial assets, such as stocks and bonds, are being supported by massive inflation of the money supply.

However, the Evergrande crisis has already resulted in hundreds of billions in equity losses globally. Under current global financial conditions, it would make sense for gold and silver prices to rise sharply this year. 

Copper plunged on the LME

Copper’s bullish rally hardly stumbled on the London Metal Exchange. Of course, it happened because the pound closed operations in the spot market with a decline of 4.61%, its biggest daily fall since March 4.

At the same time, the commodities market has been suffering from an energy crisis and a sharp fall in the red metal inventories. 

Soy rises for the fifth consecutive day

The price of soybeans rose by 1.48% to $458. Meanwhile, corn and wheat followed the positive trend of the market. 

For corn, the declines in the energy market limit the increases. Meanwhile, wheat futures are trading higher amid a global supply shortage that boosts cereal prices.