Oil prices climbed on Friday, ensuring a third straight weekly gain for the commodity as OPEC officials said that discussions by producers to limit output could be revived.
US benchmark West Texas Intermediate for June gained US$0.55 to US$43.73 a barrel on the New York Mercantile Exchange.
In London, Brent North Sea oil for delivery in June rose US$0.58 to US$45.11 a barrel.
Friday’s gains lifted the US advance for the week to 8.3 percent, while Brent crude rose 4.7 percent.
OPEC secretary-general Abdalla El-Badri said the cartel could revive talks between members on a production freeze and hold further talks with non-members.
The oil market also got support from the Baker Hughes weekly US rig count, which showed that oil producers curtailed use of eight drilling rigs in the week ending on Friday.
“Market sentiment is certainly positive and the flow of buying has clearly not been exhausted,” Citi Futures analyst Tim Evans said. “At the same time, we also note a few voices beginning to question whether the higher levels will prove sustainable.”
Some analysts said there was no reason to expect OPEC to reach a deal in its June meeting after Sunday’s talks failed, in part because Iran refused to accept a cap while it rebuilds its output after sanctions were lifted in January.
BMI Research warned in a note that the long-running enmity between Iran and Saudi Arabia — who are fighting proxy wars in the Middle East — could prevent any deal being made.
“We believe that Saudi Arabia and Iran’s disagreement over oil is a symptom of wider geopolitical tensions between the two, and therefore do not expect a political OPEC agreement to be reached during the June 2 meeting,” it said.
PRECIOUS METALS: Precious metals soared this week on the struggling US currency.
The US dollar flagged as poor US economic data reinforced the view that the US Federal Reserve will remain cautious about raising interest rates.
The US central bank had implemented its first hike in almost a decade in December last year, signaling the start of a rate-tightening cycle.
“Precious metals are surging across the board, with silver and now platinum looking particularly bullish,” City Index analyst Fawad Razaqzada said.
“The pressure has been building for precious metals like silver to explode higher in recent months. The significantly weaker dollar has helped to underpin several buck-denominated commodities of late. The US currency has depreciated because of receding expectations about the pace of interest rate rises,” Razaqzada added.
A struggling greenback makes dollar-denominated commodities cheaper for buyers who are using stronger currencies.
That tends to stimulate demand and send prices higher.
Gold rose on Thursday to a five-week high at US$1,270.47 per ounce, helping to push sister metal silver to an 11-month peak at US$17.69.
Platinum and palladium scaled their way to multi-month heights.
Razaqzada added that “extremely loose central bank policy across the globe has boosted the appeal of precious metals since they are all non-interest-bearing assets.”
The European Central Bank on Thursday opted to maintain its loose monetary policy, but pledged more easing to stimulate growth if needed.
At the same time, fading Chinese demand concerns have also been “helpful” for silver prices, Razaqzada said.
“Chinese demand fears have receded in recent times owing to an improvement in data there,” he said. “This has been especially helpful for silver, which, as well as being a precious metal, has many industrial uses.”
By Friday on the London Bullion Market, the price of gold rose to US$1,243.25 an ounce, from US$1,227.10 a week earlier.
Silver advanced to US$17.19 an ounce from US$16.17.
On the London Platinum and Palladium Market, platinum increased to US$1,028 an ounce from US$986.
Palladium grew to US$611 an ounce from US$568.
BASE METALS: The prices of industrial metals forged higher this week, aided by Chinese demand hopes, rebounding oil and the weakening dollar.
Aluminium on Friday surged to a seven-month high at US$1,655 per tonne — not seen since September last year.
Nickel soared to five-month peak at US$9,585 per tonne, and zinc hit US$1,958 per tonne — scoring its best level in eight months.
Copper, lead and tin had rallied on Thursday to one-month pinnacles.
“China is turning the corner and ... economic data supports that,” said William Adams, head of commodity research at metals research group Fastmarkets.
Sentiment brightened as a string of upbeat data from China and rising oil prices fueled hopes for the global economy and commodity demand.
China’s economy grew 1.1 percent in the first quarter of this year compared with the previous three months. However, that marked a slowdown from 1.5 percent expansion in the last quarter of last year.
Adams added that metals demand could also be powered higher by restocking.
“The big question is whether consumers then come in to restock — and whether equity and bond markets start to correct as well,” he said. “A restocking cycle in the commodity markets can be a very powerful phenomenon.”
On the London Metal Exchange, copper for delivery in three months rose to US$5,050 a tonne from US$4,806.50 a week earlier.
Three-month aluminum increased to US$1,655 a tonne from US$1,550.50.
Three-month lead advanced to US$1,794 a tonne from US$1,726.
Three-month tin climbed to US$17,365 a tonne from US$17,222.
Three-month nickel gained to US$9,265 a tonne from US$8,935.
Three-month zinc increased to US$1,931 a tonne from US$1,876.50.
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