Oil rebounded this week from recent lows after OPEC sprang a surprise meeting next month, at which Saudi Arabia hinted producers could agree to limit output.
At 4pm on Friday, West Texas Intermediate (WTI) crude for delivery next month added US$0.84 at US$44.33 a barrel compared with Thursday’s closing level.
European benchmark Brent North Sea crude for October rose US$0.65 to US$46.69 per barrel.
Both contracts traded far above the three-month lows forged early last week, when prices had tanked into a bear market — losing 20 percent from June peaks.
OPEC, whose 14 nations pump one-third of global oil, on Monday called an informal meeting that is to take place on the sidelines of the International Energy Forum in Algeria late next month.
News of the unscheduled gathering, ahead of OPEC’s next regular production meet in Vienna on Nov. 30, sparked speculation of fresh measures to stabilize the market — and sent prices soaring on Monday.
They powered even higher on Thursday after Saudi Arabian Minister of Energy, Industry and Mineral Resources Khalid al-Falih hinted that producers could agree to limit output.
Al-Falih was reported as saying that the informal OPEC meeting would be an occasion for producers to discuss “any possible action.”
Prices jumped more than 4 percent in reaction to the comments, which were seen as a positive development in a market grappling with a supply glut.
PRECIOUS METALS: As far as technical indicators go, the gold rally is losing steam — and the market is finally taking notice.
Gold futures posted the first back-to-back weekly losses for a most-active contract in more than two months after prices failed to break above the three-week high reached on Aug. 2. Futures ended lower on Friday, even after prices shot up following the release of disappointing US government data that weakened the case for the US Federal Reserve to raise interest rates.
Bullion’s moving average convergence-divergence indicator, a gauge of price momentum, has been below the signal line since Aug. 5, showing downward pressure on prices, Ottawa-based Trading Central senior technical analyst Gary Christie said.
Prices have fallen 2.5 percent from a two-year high last month.
Gold futures fell 0.5 percent to settle at US$1,343.20 an ounce at 1:39pm on the Comex in New York, wiping out this week’s gains. Silver futures also slipped on the Comex, while palladium and platinum declined on the New York Mercantile Exchange.
BASE METALS: Nickel led a slump in industrial metals, dragging down mining stocks, after several economic reports on China revived demand concerns in the world’s top user of raw materials.
China’s economic stabilization faltered last month, as factory output, retail sales and investment all slowed. The country’s broadest measure of new credit and another key gauge of lending increased at the slowest pace in two years. In the US, retail sales stalled last month, while wholesale prices unexpectedly fell.
Nickel for delivery in three months dropped 4 percent to settle at US$10,305 a tonne at 5:51pm in London. It slipped 5.1 percent in the past two days, the most since May.
Copper, zinc and tin also fell on the London Metal Exchange, while aluminum and lead gained.
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