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Oil and gas prices are rising

Highlights:

  • ENERGY:
    December WTI crude futures were trading with a rise of 0.61% or $0.42 at $69.55. Meanwhile, December Brent crude futures added 0.55% or $0.40 at $ 72.66.
    December natural gas futures were trading with an increase of 1.80% or $0.91 to $5.158.
  • METALS:
    Gold futures for October delivery was trading with a loss of $2.30 at $1,787.60. Meanwhile, Silver futures for December delivery on Comex slipped by $0.34 to $23.555 an ounce.
    Copper futures contracts for September delivery slipped by 0.03% to Rs 740.90 per kg.
  • AGRICULTURAL:
    The USDA forecasts weakened corn and soybeans prices.

Offshore crude production stops, but refineries are ready again

West Texas Intermediate and Brent futures were trading higher Monday. Energy companies struggle to regain production blocked after Hurricane Ida that’s supporting the prices. Meanwhile, expectations of increased demand are also providing support. Besides, there are concerns about a new tropical storm brewing in the Gulf of Mexico.

December WTI crude futures were trading with a rise of 0.61% or $0.42 at $69.55. Meanwhile, December Brent crude futures added 0.55% or $0.40 at $ 72.66.

About three-quarters of offshore oil production in the US Gulf of Mexico has reportedly been frozen since the end of August. Meanwhile, US refineries are recovering fast from the impact of Hurricane Ida. Most of the nine Louisiana refineries affected by the storm had either restarted or were restarting as of Friday.

Goldman Sachs analysts said Hurricane Ida was the only one that had a net upward impact on the oil balances of the United States and the world. It had a lesser impact on demand than on production.

 

The new storm could slow natural gas production

US natural gas futures were trading higher early Monday. Factors supporting the market were concerns about low production caused by the impact of Hurricane Ida. Besides, the market is anxious that storage levels may be inadequate for the winter heating season.

December natural gas futures were trading with an increase of 1.80% or $0.91 to $5.158.

Concerns about a new storm approaching the Gulf of Mexico could also be giving the market a boost. NatGasWeather already said on Friday that a new tropical storm would try to strengthen in the western end of the Gulf of Mexico. It will then head towards the southern border of Texas on Tuesday and could force further delays in Gulf of Mexico production.

According to NatGasWeather, September 13-19, the northern half of the US will experience pleasant conditions. The southern half will be very warm. Temperatures will cool off the Texas coast as heavy rains and winds arrive with Tropical Storm Nicolas between Tuesday and Friday.

Overall, domestic demand will be low in the northern US but moderate to high in the south.

 

Gold and silver weakened on a stronger dollar

Gold and silver prices declined in the early US trading on Monday because of the dollar rebound. 

Gold futures for October delivery was trading with a loss of $2.30 at $1,787.60. Meanwhile, Silver futures for December delivery on Comex slipped by $0.34 to $23.555 an ounce.

According to analysts, gold futures bulls still have near term technical advantage. Bull’s next price objective is to close above solid resistance of $1,836.20. Meanwhile, bears downside price objective is pushing the price below the solid support at $1,775.00.

As for silver, the next upside price objective for the white metal bulls is to close above the technical resistance at $25.00 an ounce. Meanwhile, the next downside price objective for the bears is to settle below the solid support level of $22.35.

 

Copper prices dropped on weak demand

Copper futures prices declined on Monday since the market participants cut their positions due to weak demand. 

In India, copper futures contracts for September delivery slipped by 0.03% to Rs 740.90 per kg.

 

Palladium price sinks to a 12-month low

The spot price of palladium fell to its lowest level in more than a year due to doubts about the demand by the automotive industry.

Palladium slid for the fourth day in a row to its lowest level since August 2020. At the time of writing, the spot price was around $2,211 an ounce.

According to a recent report by the World Platinum Investment Council, the higher cost of palladium is expected to cause a gradual change in manufacturers. As a result, there are prospects of replacing palladium with platinum in the manufacture of catalysts.

 

Corn and soybeans slipped on Monday

Corn and soybeans prices dipped on Monday after the USDA forecasts of larger harvests in the country.

The US Department of Agriculture increased its forecasts of corn yield by 1.7%. Besides, rains in August raised the soybean harvest outlook.

Despite the bearish news, some analysts expected even more bearish numbers. So, the drop today has not been sharp.

Soybean markets keep focusing on the demand side from China. 

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