Oil prices hit fresh multi-month low points this week, with no sign of an end to a global supply glut.
Metals, including gold and copper, stabilized after a recent rout fueled by cracks in the Chinese economy.
OIL: Brent crude hit US$52.28 a barrel on Tuesday, the lowest level since Feb. 2.
The same day, New York’s main contract dropped to US$46.68 a barrel, the lowest point since March 24.
After briefly recovering, both contracts tumbled on Thursday after OPEC Secretary-General Abdullah al-Badri said the group would not cut output in response to lower prices.
Speaking in Moscow after meeting Russia’s energy minister, he said the cartel is “not ready” to cut production, which is currently at about 30 million barrels per day.
Analysts said the statement shows OPEC is determined to defend its market share as it fends off competition from US shale oil.
“OPEC is telling the market that cuts will not come from them,” Singapore-based Phillip Futures investment analyst Daniel Ang said.
OPEC is “emphasizing that it is fighting for market share,” he added.
At its most recent meeting in Vienna in June, OPEC kept its output levels despite the supply glut that has depressed oil prices.
Crude futures are also under pressure owing to the strength of the US currency, which makes US dollar-priced oil more expensive to holders of weaker units, dampening demand.
The US dollar has picked up steam on expectations the US Federal Reserve will raise US interest rates later this year.
The chances of a lift next month were raised on Thursday after data showed the US economy expanded 2.3 percent in the April-June period, the strongest pace since the third quarter of last year.
“The second-quarter GDP data support the Fed’s more upbeat tone on economic conditions and suggests that the economy could cope with higher interest rates,” research firm Capital Economics said.
By Friday on London’s Intercontinental Exchange, Brent North Sea crude for delivery next month slid to US$52.69 a barrel from US$54.42 a week earlier. On the New York Mercantile Exchange, West Texas Intermediate (WTI) or light sweet crude for September fell to US$47.66 a barrel from US$48.01.
PRECIOUS METALS: Gold rose slightly, but stayed pressured after slumping to more than five-year lows the previous week.
“We have officially entered the next era of weakness for gold and as economic data continues to demonstrate that the US economy is progressing, gold will be exposed to further losses,” said Jameel Ahmad, chief market analyst at trading group FXTM.
By Friday on the London Bullion Market, the price of gold rose to US$1,098.40 an ounce from US$1,080.80 a week earlier.
Silver climbed to US$14.56 an ounce from US$14.49.
On the London Platinum and Palladium Market, platinum was unchanged at US$979 an ounce.
Palladium fell to US$610 an ounce from US$616.
BASE METALS: Prices mostly stablized compared with a week earlier, but remained held back by a strong dollar and concerns over the Chinese economy, with copper hitting a fresh six-year low at US$1,631 a tonne.
“One of the reasons for the weak prices is no doubt the appreciation of the US dollar in the wake of the Fed meeting,” analysts at Commerzbank said.
By Friday on the London Metal Exchange, copper for delivery in three months slipped to US$5,218.50 a tonne from US$5,245 a week earlier.
Three-month aluminum decreased to US$1,631.50 a tonne from US$1,636.50.
Three-month lead fell to US$1,703.50 a tonne from US$1,714.50, while hree-month tin surged to US$16,105 a tonne from US$14,910. Three-month nickel retreated to US$10,940 a tonne from US$11,250.Three-month zinc dipped to US$1,942 a tonne from US$1,958.50.
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