World oil prices rose this week on concerns that heightened geopolitical tensions could disrupt Middle East supplies, despite a market awash with crude.
Traders were turning their attention to next week’s OPEC output meeting to see if the oil producers’ cartel will slash high output levels.
The 12-nation OPEC, which counts the world’s biggest oil producer, Saudi Arabia, among its members, as well as Nigeria, Venezuela and Iran, holds a regular meeting in Vienna on Friday next week.
Most analysts expect the cartel to stick to its decision taken at the last meeting in June, when OPEC defied calls to cut output despite sliding oil prices, extending its strategy of preserving market share and fending off competition from the US shale energy boom.
Downward pressure on the oil market this week was capped by the shooting down by Turkey of a Russian fighter jet on the Syrian border.
However, reports that Russia is not taking military action against Turkey in retaliation eased fears that the tense situation in the region could escalate and disrupt Middle East oil supplies.
Moscow said retaliatory measures would focus on using its leverage to tighten the screws on Turkey’s economy, including halting joint economic projects.
By late on Friday in London, Brent North Sea crude for delivery in January edged higher to US$44.93 a barrel from US$44.66 a barrel one week earlier.
US benchmark West Texas Intermediate for January stood at US$42.02 a barrel, compared with US$40.39 for the expired December contract one week earlier.
PRECIOUS METALS: Gold fell to the lowest in five years as speculation that US policymakers will raise interest rates next month helped boost the dollar, curbing the metal’s appeal as an alternative asset.
The greenback climbed as much as 0.3 percent against a basket of 10 currencies on Friday to near the highest since at least 2004.
Odds that the US Federal Reserve will increase rates next month for the first time since 2006 advanced to 72 percent on Friday, from 35 percent a month ago, Fed-fund futures data show.
Bets on higher rates have risen as a resilient US labor market powers consumer spending, adding to signs that the economy may be robust enough to withstand higher rates.
Tighter monetary policy reduces the allure of gold because it does not pay interest, unlike competing investments. Assets in exchange-traded products backed by the metal have fallen to the lowest since 2009, while hedge funds are holding a net-short position.
Gold futures for February delivery declined 1.3 percent to settle at US$1,056.20 an ounce at 12:45pm on the Comex in New York. Earlier, the price fell to US$1,051.60, the lowest since February 2010.
Holdings in gold-backed ETPs fell for a sixth straight day through Wednesday to 1,493.5 tonnes, data compiled by Bloomberg show.
Silver futures for March delivery fell 0.9 percent to US$14.048 an ounce on the Comex. On the New York Mercantile Exchange, platinum futures for January delivery fell 1 percent to US$835.80, while palladium futures for March delivery slid 0.2 percent to US$550.65 an ounce.
BASE METALS: A rebound in industrial metals underpinned gains in Asian materials producers ahead of data on Chinese industrial company profits, while crude oil retreated.
Base metals, with the exception of nickel, extended Thursday’s advances in London, propelling regional mining stocks higher for the first time this week amid signs China may act to prop up local metals prices. US index futures climbed ahead of a shortened trading day in New York following Thanksgiving. US oil dropped as concern over tensions in the Middle East abated. The dollar hovered near a a seven-month high versus the euro.
Prospects China may intervene in the domestic metals industry to stop excessive futures short selling bolstered base metals prices, with the largest copper and nickel suppliers planning to meet this week to weigh their response to the slump in prices.
Copper for three-month delivery climbed 1.1 percent to US$4,688 a tonne in London, with futures for March delivery up 3.1 percent on the Comex from Wednesday’s close. Aluminum and zinc gained at least 0.8 percent, while nickel was unchanged following a 3.2 percent jump on Thursday.
The LME Metals Index, which tracks six primary metals, climbed 2.2 percent last session to its highest close since Nov. 13.
Gogoro Inc (睿能創意) yesterday launched its first electric bicycle, the Gogoro Eeyo 1, in Taiwan, after unveiling the bike in New York in late May and in France on Tuesday. The company said it would also introduce the series in other European countries such as Germany and the Netherlands. The “Eeyo project” is the fourth of Gogoro’s eight projects that concentrate on smart transportation, which includes Gogoro’s electric scooter, battery swap system and electric scooter sharing service, company founder and chief executive officer Horace Luke (陸學森) told a media briefing in Taipei. “There are various types of city commuters. We will not
With the US dollar expected to weaken in the next 12 months due to near-zero interest rates, investors should consider purchasing US corporate bonds, Standard Chartered Bank Taiwan Ltd (渣打台灣銀行) said on Thursday. The bank said that the US Federal Reserve since last month has been buying bonds issued by US companies to curb default rates. The US dollar is forecast to be weaker against the pound, the euro and the yen, as well as the Canadian dollar, the Swedish krona and the Swiss franc, as the greenback lacks high investment returns after the Fed in March slashed the benchmark interest rate
BAD RAP: The exchange said Tatung had seriously breached shareholders’ rights and failed to give a satisfactory explanation of its board election dispute Tatung Co (大同) shares yesterday plunged by the maximum daily limit of 10 percent to NT$18.90, the lowest in three months, after the Taiwan Stock Exchange (TWSE) on Tuesday evening changed the company’s classification to a full-delivery stock effective tomorrow. The TWSE’s move follows the company’s failure to give a clear and satisfactory explanation of why it deprived dozens of shareholders of their voting rights during a board election at the annual shareholders’ meeting on Tuesday morning. Under the exchange’s regulations, investors are not allowed to engage in margin trading of a full-delivery stock, TWSE spokeswoman Rebecca Chen (陳麗卿) told
SIZE MATTERS: Medium-sized hotels that do not have the support of parent groups are more vulnerable and are forced to take action, a REPro Knight Frank researcher said About 50 hotels across Taiwan are seeking to exit the market as they succumb to the bleak business outlook amid international travel restrictions imposed to combat the COVID-19 pandemic. Yomi Hotel (優美飯店) on Minsheng E Road, Sec 1, in Taipei is seeking to transfer ownership with an asking price of NT$950 million (US$32.15 million) and a pledge for a lease contract that guarantees a 3 percent return. The budget hotel, with room rates that start from NT$1,400 per night, maintains normal operations, but has been struggling since March, when the government placed restrictions on inbound and outbound travel. Occupancy rates for hotels in