Oil up more than 4%
Oil prices rose more than 4% in the first session of the week, extending gains from last week due to possible OPEC + production cuts and conflict in Libya. However, the uptrend was restrained by a stronger USD exchange rate and a worsening US economic outlook.
Saudi Arabia, the top producer of the Organization of the Petroleum Exporting Countries (OPEC), last week floated the idea of an output cut, which sources said could coincide with an increase in supply from Iran if it reaches a nuclear deal with the West.
Brent crude ended the session up $4.10, or 4.1 percent, to $105.09 a barrel, after rising 4.4 percent in the previous week. The price of U.S. West Texas Intermediate (WTI) oil rose $3.95, or 4.2 percent, to $97.01, after rising 2.5 percent last week.
The unrest in the Libyan capital over the weekend, which left 32 people dead, raised fears that the country could fall into a full-blown conflict and disrupt oil supplies from OPEC nations. .
Gold recovers from one-month low
Gold prices fluctuated strongly in the past session, falling deeply at the beginning of the session but recovering at the end when the USD stopped rising.
Spot gold ended the session at $1,737.57 per ounce, firmly compared to the closing price of the previous session. Earlier in the same session, the price hit its lowest level since July 27, at $1,719.56. Gold futures in December were also firm at $1,749.7 per ounce.
“Gold sold off after Mr. Powell’s speech but has now recovered as investors hunt for bargains and after the dollar cooled down,” said Bob Haberkorn, senior market strategist at RJO Futures. Gold will return to trading in a tight range until more clues from the Fed are available.”
The dollar fell 0.1% late in the session, backing off a two-decade high earlier in the session, making gold less expensive for buyers in other currencies.
In a speech in Jackson Hole, Wyoming, Federal Reserve Chairman Jerome Powell said the Fed would raise interest rates higher if needed to contain inflation.
Base metal fell
Base metals prices on the Shanghai exchange fell in the past session on concerns about economic growth as well as metal demand slowing after the Fed Chairman signaled more interest rate hikes.
Mr. Powell on Friday warned that Americans are going through a period of slow economic growth and possible increase in unemployment. Slowing growth could lead to lower base metal demand.
Copper futures for October delivery on the Shanghai Futures Exchange closed down 1.3% to 62,550 yuan ($9,039.41) per ton; nickel fell 5% to 165,060 yuan/t and zinc fell 1.6% to 25,025 yuan/mt.
The London Metal Exchange is closed for a holiday.
Iron ore prices in Dalian also fell, ending a five-day rally earlier on concerns about steel production restrictions in China, the world’s top steel producer.
The January iron ore contract on China’s Dalian Commodity Exchange ended the session down 1.4% at 714 yuan ($103.19) a tonne.
On the Singapore Exchange, the September iron ore contract fell 3.8% to $101.90 a tonne.
The price of rebar on the Shanghai trading floor this session also fell 2.8%, while hot rolled coil decreased 2.1%. The price of stainless steel alone increased by 0.2%.
Arabica coffee reduced
New York arabica coffee prices fell from multi-month highs hit last week amid sparse trading as the London market closed for a holiday.
December Arabica coffee futures fell 1.5 cents, or 0.6%, to $2,366/lb, after hitting a six-month high of $2.4295 last Thursday (August 25). .
There is no robusta coffee futures trading in London.
Corn reached the “top” in 2 months
Chicago corn prices jumped to a two-month high after a U.S. crop survey showed crops were damaged by hot weather and production was expected to fall short of the government’s expectations.
Wheat prices also rose to a seven-week high, while soybeans fell after a survey showed a bumper US soybean production.
Corn futures for reference ended the session up 18-3/4 US cents to 6.83 USD/bushel; Wheat rose 37-1/2 US cent to 8.42-3/4 USD/bushel, while soybean fell 23-1/2 US cent to 14.37-3/4 USD/bushel.
Gas plunges
Natural gas prices on the European market fell more than 18 percent to less than 280 euros/megawatt-hour, contrasting a trend of nearly 40 percent increase last week, after Germany said its gas storage facilities are expected to will be 85% full next month, earlier than the target of October.
However, the current supply is still scarce and the supply outlook for the winter is still very uncertain.
Russia’s Gazprom will stop shipping gas to Europe via Nord Stream for three days from Wednesday (August 31) after reducing pipeline traffic by about 20%. Meanwhile, Norway, which has overtaken Russia as the largest gas supplier to Europe after the war in Ukraine, will cut its gas exports for planned and unplanned maintenance in Ukraine. 13 mines and processing plants throughout September.
Rubber rose
The price of rubber traded in Japan increased in the session on August 29, following the upward trend on the Shanghai floor and due to the depreciation of the yen against the USD.
Rubber contract for February delivery on the Osaka floor ended twang 2.3 yen, or 1.0%, to 228.5 yen ($1.65)/kg. The January rubber contract on the Shanghai futures exchange rose 225 yuan to 12,770 yuan ($1,845) a tonne.
Prices of some key items in the morning of August 30:
