Sun, Nov 09, 2014 - Page 15 News List

Gold extends slump in turbulent week

AFP, LONDON

Gold prices hit a four-year low, hit by a persistently strong US dollar, while crude oil plumbed multi-year troughs on fears over Saudi Arabia price cuts and plentiful supplies.

“The precious metal sector was the hardest hit for a second week in a row, with both gold and silver continuing to be sold,” Saxo Bank analyst Ole Hansen said.

PRECIOUS METALS: Gold on Friday plunged to US$1,131.24 per ounce — its lowest level since mid-April 2010 — while silver touched a similar nadir at US$15.06 an ounce.

By late on Friday on the London Bullion Market, the price of gold sank to US$1,154.50 an ounce from US$1,164.25 a week earlier, while silver declined to US$15.42 an ounce from US$16.20.

On the London Platinum and Palladium Market, platinum weakened to US$1,198 an ounce from US$1,227 and palladium dipped to US$763 an ounce from US$784.

OIL: In a roller-coaster week for the oil market, prices plunged on Tuesday after leading producer Saudi Arabia cut its prices for crude sold to the US market.

New York crude fell to its lowest close since October 2011 and Brent to its lowest since October 2010.

Analysts interpreted the Saudi move as an effort to maintain market share in North America against cheaper oil flooding from US shale fields.

New York crude rebounded on Wednesday after the US Energy Information Administration revealed a smaller-than-expected increase in crude oil supplies.

The agency reported that US crude inventories grew by 500,000 barrels in the week ending on Oct. 31. That was much less than the 2.2 million barrel increase expected by analysts. The market also rallied on Wednesday following reports of a pipeline blast in Saudi Arabia. However, state-owned oil firm Saudi Aramco said operations were unaffected.

Crude futures sank on Thursday after OPEC cut its longer-term production forecasts in the face of rising North American shale output.

The cartel estimated in its annual world outlook that global demand for OPEC crude oil will fall from just above 30 million barrels per day last year to 28.2 million barrels a day in 2017, before starting to rise again in 2018.

By Friday on London’s Intercontinental Exchange, Brent North Sea crude for delivery next month slid to US$83.64 a barrel from US$85.36 one week earlier.

On the New York Mercantile Exchange, West Texas Intermediate, or light sweet crude, for next month recoiled to US$78.99 a barrel from US$80.18 a week earlier.

COCOA: The market continued to decline amid easing output worries due to the Ebola epidemic in west Africa, home to most of the world’s cocoa production.

Prices soared in September over worries that Ebola could reach key producers Ivory Coast and Ghana.

By Friday on LIFFE, cocoa for delivery in March dropped to £1,905 a tonne from £1,933 for next month’s contract a week earlier.

On the ICE Futures US exchange, cocoa for March fell to US$2,893 a tonne from US$2,936 for next month’s contract last week.

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