Sun, Jan 20, 2013 - Page 15 News List

Commodities gain on Algeria unrest, upbeat sentiment

RISK PREMIUM:Analysts said the hostage crisis at a gas field in Algeria had boosted oil prices, while metals went up on data from the US and China

AFP, LONDON

Commodity prices mostly rose this week, with oil prices supported by the Algeria hostage drama, while metals won support from positive Chinese and US economic data.

OIL: Crude futures rose, supported by unrest in energy exporter Algeria, better-than-expected Chinese economic data and signs of improving crude demand in the US, analysts said.

The Algeria violence has “put a geopolitical risk premium into pricing,” said Victor Shum, an analyst at research group IHS Purvin and Gertz.

In Algeria, an exporter of oil and gas, hostages were still being held at a remote gas field on Friday after a deadly rescue attempt.

An Algerian security source said some of the hostage-takers were still holed up in the main gas production facility after troops seized a nearby housing compound in an air and ground assault on Thursday.

The gas field is jointly operated by British oil giant BP PLC, Norway’s Statoil ASA and state-run Algerian energy firm Sonatrach.

Oil prices closed up more than U$1 on Thursday, boosted by positive US economic data and fears linked to the hostage-taking, traders said.

The US this week also announced an unexpected drop to its crude inventories, indicating firmer demand by the world’s biggest consumer of oil.

BP this week said that the US would become almost self-sufficient for its energy needs by 2030, boosted by shale oil and gas output and slowing demand.

The oil market also reacted to economic data out of China, choosing to focus on GDP growth in the final quarter of last year, which showed an uptick after seven straight quarters of slowing expansion.

Beijing said its economy expanded 7.8 percent last year — better than the government’s target of 7.5 percent, marking a second straight year of easing on weakness in key overseas markets.

By Friday on the New York Mercantile Exchange, West Texas Intermediate, or light sweet crude, for delivery next month climbed to US$95.38 a barrel from US$93.25 a week earlier.

On London’s Intercontinental Exchange, Brent North Sea crude for March stood at US$110.85 a barrel, compared with US$110.19 for next month’s contract the previous week.

PRECIOUS METALS: Platinum prices hit three-month highs at 1,702.05 an ounce as top global platinum miner Anglo American Platinum warned it would axe 14,000 jobs in a broad restructuring of its South African operations, prompting workers to launch a new strike.

Months after being swept up in deadly strikes that crippled South Africa’s key mining sector, Amplats on Tuesday said it planned to close four shafts and sell a mine considered unsustainable.

By late on Friday on the London Bullion Market, gold advanced to US$1,688.50 an ounce from US$1,657.50 a week earlier.

Silver rose to US$31.82 an ounce from US$30.67.

On the London Platinum and Palladium Market, platinum climbed to US$1,677 an ounce from US$1,626. Palladium increased to US$722 an ounce from US$693.5.

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