Oil plunged close to six-year lows this week on oversupply worries, before staging a slight recovery as the International Energy Agency (IAE) said that there were signs that “the tide will turn.”
Commodity investors also digested the Swiss central bank’s shock move to abandon its policy of weakening the franc, while traders readied for next week’s pivotal European Central Bank meeting.
OIL: European benchmark Brent tumbled on Tuesday to US$45.19 per barrel, a level last seen in March 2009, while New York crude struck a similar low at US$44.20.
“How low the market’s floor will be is anyone’s guess,” the IEA watchdog said in a monthly report on Friday. “A price recovery — barring any major disruption — may not be imminent, but signs are mounting that the tide will turn.”
The global oil market has more than halved since June last year, crashing due to stubborn worries over global oversupply and weak demand in a faltering world economy.
The IEA maintained its oil demand forecast for the year, expecting it to grow by 0.9 million barrels a day to reach 93.3 million barrels.
The oil market was hit again on Thursday by news that OPEC overproduced last month and had cut its global demand outlook.
Slumping oil sent shockwaves through the energy industry, sparking job losses and project cancelations, with Royal Dutch Shell axing a vast US $6.5 billion petrochemical investment with Qatar Petroleum.
By Friday on London’s Intercontinental Exchange, Brent North Sea crude for delivery in March eased to US$49.50 a barrel from the US$49.67 for next month’s contract posted the previous week.
On the New York Mercantile Exchange, West Texas Intermediate, or light sweet crude, for next month reversed to US$47.16 a barrel from US$47.96.
PRECIOUS METALS: Gold rallied to a four-month peak at US$1,279 per ounce on Friday, as investors sought shelter from markets turmoil.
By Friday on the London Bullion Market, gold rallied to US$1,277.50 an ounce from US$1,217.75 a week earlier, while silver climbed to US$16.92 an ounce from US$16.24.
On the London Platinum and Palladium Market, platinum rose to US$1,262 an ounce from US$1,225 and palladium edged down to US$757 from US$795.
BASE METALS: Copper tumbled to its lowest level in more than five years after the World Bank slashed its global economic growth forecast from 3.4 percent to 3 percent for this year, parking doubts over the demand outlook for the metal.
Copper on Wednesday dived to US$5,353.25 per tonne, a level last witnessed in July 2009.
By Friday on the London Metal Exchange, copper for delivery in three months sank to US$5,679 a tonne from US$6,112 last week.
Three-month aluminum slid to US$1,802 a tonne from US$1,820.50 the previous week, lead retreated to US$1,785.25 from US$1,820.50, tin dipped to US$19,400 from US$19,630 and nickel fell to US$14,567 from US$15,508.
RUBBER: Prices sank on the World Bank forecast and oil slump.
The Malaysian Rubber Board’s benchmark SMR20 on Friday fell to US$0.13990 a kilo from US$0.14445 the previous week.
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