Oil Trades Mixed while Gold is on a Bearish Trend
WTI increased by 1.2% to $73.16 a barrel, meanwhile Brent crude yielded 0.09% at $75.31 ahead of the OPEC+ meeting;
Natural gas prices on the rise; Russia to export gas to Europe through Nord Stream 2 pipeline.
Gold settled at $1781 with a bearish trend. Silver futures added 0.10% to Rs 67,943 per kg. Copper decreased by 0.3% and traded at $9,383.50 a tonne.
Soybean futures for July delivery advanced by 0.83%. Corn added 0.6% to $5.22-1/2 a bushel.
Oil Prices Settled Mixed Ahead of the OPEC+ Meeting
Oil prices settled on the mixed territory after reaching new highs.
WTI traded with a rise of 1.2% at $73.16 a barrel.
Oil prices have received some support from the passage of an infrastructure construction bill in the United States. It has fueled optimism about the energy demand outlook.
Brent crude dropped by 0.09% at $75.31 per barrel after settling at $75.38 a barrel on Friday. Now the focus is on the OPEC+ meeting, which will be held on July 1. The group was discussing a new partial cancellation of the production cuts that would take effect from August. However, OPEC and its allies have not made the decision yet.
Russian producers believe that August is an excellent period to increase oil production even knowing the expected return of Iran to the markets. They think there is a deficit in the market with current levels.
The price of natural gas continues to rise
The natural gas markets have broken the rise over the past two days and have crossed the $3.40 level, which was a key resistance level.
The commodity futures traded firm on Monday.
US president Joe Biden and Russian president Vladimir Putin held a summit suggesting that the Nord Stream 2 pipeline is a done deal. It is a joint venture between European gas companies and the Russian state-owned Gazprom and will transport natural gas into the European Union. It is projected to bring $3.2 billion to Russia annually.
For Putin, it is an opportunity to expand his influence in Europe.
Gold continues to suffer
In Friday’s trading session, gold traded at $1790 and settled at $1781.
Analysts expect a decline for gold towards $1773. Anything below that level will target $1765 and $1756 dollars.
The general trend for the commodity is sideways bearish.
In the absence of relevant US economic data, the gold price will closely follow broader market sentiment and the dollar’s dynamics. This week, the main event risk remains the US Nonfarm Payrolls which are due on Friday.
Silver trades steadily
Silver prices have been steady on Monday. The metal added 0.43% last week on MCX. Sriram Iyer, a Senior Research Analyst at Reliance Securities, believes that the white metal will keep its bullish momentum up to $26.30-$26.90. Besides, silver prices have been rising on Monday afternoon trade in Asia.
As for the silver delivery for July, it increased by 0.10% to Rs 67,943 per kg. In New York, the metal price was up by 0.25%, trading at $26.15 an ounce.
A Sink in China’s industrial profits weighed on copper prices
Copper prices dropped on Monday on LME, close to finishing a third straight day of losses. Three-month-old copper yielded 0.3% and was trading at $9,383.50 a tonne. Profit growth at China’s industrial companies decreased again in May as rising raw material prices compressed margins and weighed on factory activity.
Soybean prices opened higher on Monday
Soybean prices increased on Monday after plummeting last week, and front-month futures finished the week with a decrease of 23.8% compared to Mid-May prices. The commodity prices added Rs 58 to Rs 7,038 per quintal in the futures market. Traders created fresh positions after a buoyant spot demand.
Soybean futures for July delivery advanced by 0.83%.
Marketmen said raising new positions by speculators on the back of higher demand mainly led to a rise in soybean prices.
Corn prices are increasing amid dry weather
Chicago corn price increased on Monday by 0.6% to $5.22-1/2 a bushel.
According to Matt Ammermann, a commodity risk manager at StoneX, US Supreme Court’s judgment on biofuel blending is assessed. So, after Friday’s slump, there is some bargain-buying in corn, wheat, and soybeans. On the other hand, forecasts of dry weather in the US Midwest provide support of commodity prices.
Traders are awaiting data from the US Department of Agriculture on Wednesday.