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Crude stocks rose again last week, despite drops in production and net oil imports. However, gasoline and distillate fuel stocks eased back. … US Weekly Petroleum Status Report (10th Aug. …
10th August 2016
OPEC production reached a new record in July with the Gulf members showing no signs of wanting to limit output. What’s more, the group revised down their estimate of how much non-OPEC output should decline this year. … OPEC production reaches another new …
We are sceptical that renewed talks of a production freeze by OPEC and other large producers will lead to an actual deal. Even if there is an agreement this time round, we doubt that freezing output now would make any difference to actual supply and the …
8th August 2016
Growth in China’s commodity import volumes slowed in July, despite some recent encouraging signs from activity indicators. In some cases, higher domestic output is edging out imports. In others, ample supply of refined products are weighing on demand for …
The price of zinc has surged in recent months, primarily on better prospects for steel demand. But while fundamentals are moving in the right direction and we expect the market to be in deficit this year, the price of zinc is looking increasingly …
On Friday, commodity prices dipped in the wake of the second consecutive strong US non-farm payrolls reading, the subsequent appreciation of the dollar and the implication that rate hikes could come sooner rather than later. That said, we think that Fed …
5th August 2016
Central banks resumed their gold purchases in June, after having turned net sellers in May, with Russia and China once again particularly active. While gold demand from the official sector was relatively subdued in the first half of 2016, the case for …
Continued falls in demand and lower Chinese imports in the second half of the year should put downward pressure on coal prices, even if small stocks support prices in the near term. … Has the rally in coal prices burnt …
The price of sugar in US dollar terms has soared, rising by nearly 30% since the start of the year, on reports of poor harvests and falling stocks. However, the upward pressure on prices from deteriorating supply has been exaggerated by investor buying. …
4th August 2016
The prices of precious metals in US dollar terms are back to the level seen at the beginning of 2010, with the exception of platinum, which has fallen sharply during the period. However, production has continued to increase owing to weaker producer …
Detailed Chinese industrial production figures for June show that output of most industrial metals increased on the month. While the general rally in metals prices has offered incentives to boost output, recent production gains also suggest that producers …
3rd August 2016
Crude oil stocks rose last week, despite production falling and demand from refineries increasing. On the other hand, gasoline stocks fell sharply. … US Weekly Petroleum Status Report (3rd Aug. …
The recent falls in oil prices have raised concerns that the fuel could be entering a new bear market. However, we think that oil prices are more likely to rebound a little by the end of the year than continue to fall as non-OPEC production declines and …
2nd August 2016
The prices of industrial and precious metals generally rose in July, despite a strengthening dollar for much of the month and only subdued economic data out of China. However, with investors more comfortable with risk, the recent rally in the gold price …
A sharp downturn in oil prices dragged the broad commodities indices lower last month so that equities outperformed. That said, there were pockets of strength, with nearly all the industrial metals rising in July on hopes of further policy stimulus in …
1st August 2016
Commodity prices generally drifted lower over the past week, although some support came later from a weaker US dollar. Indeed, the markets shrugged off disappointing US Q2 GDP data on Friday, given the subsequent fall in the value of the dollar and the …
29th July 2016
It has been a mixed bag for energy commodities this month, with oil and US natural gas prices falling back due to oversupply, a stronger dollar and cooler weather. On the other hand, coal prices surged, despite some disappointing economic data from China. …
After dipping in the wake of the UK’s vote to leave the EU (Brexit), the prices of most industrial metals have rallied strongly since. They have shrugged off disappointing economic news out of China, the increased likelihood of interest rate rises in the …
28th July 2016
Increases in domestic production and net imports helped US crude stocks build last week, while inventories of petroleum products fell on strong demand. … US Weekly Petroleum Status Report (27th Jul. …
27th July 2016
The rally in oil prices over the first half of the year, combined with the recent pull-back, has mirrored the movements in prices in the first half of 2015. However, rather than prices continuing to slump as they did in 2015 we expect them to remain at …
LME metal stocks have fallen since the start of the year, while for the most part ShFE stocks have risen. However, summing stocks on all the major exchanges, the big moves have been a 25% drop in global aluminium stocks and a 30% rise in tin stocks. …
26th July 2016
Commodity prices have had a good few months, which is consistent with our relatively positive views on the medium-term outlook. The easing of fears about China’s economy has helped industrials, while commodities in general have benefited from hopes of an …
Gold imports by China and India fell sharply in June. However, local gold premiums point to somewhat stronger demand in July. Higher prices and temporary factors have played a role in the weakness in demand from the two largest consumers so far this year. …
We have created a Capital Economics Demand Proxy (DP) to enhance our insight into the demand fundamentals of the aluminium market and to inform our near-term price forecasts. … Shining a light on aluminium …
22nd July 2016
With a few exceptions, the prices of industrial commodities have taken another hit this week, pressured by profit taking and renewed strength in the US dollar. Meanwhile, the ECB’s decision to keep interest rates on hold on Thursday weighed on the prices …
We expect a combination of looser monetary policy in the euro-zone, the UK and Japan and building inflationary pressures in the US to boost the prices of gold and silver over the next year or so. Admittedly, prices could drop back in the short term if the …
21st July 2016
The tightening of the oil market since the start of the year has been the main driver of the price rally over the last few months. However, there are valid concerns that stocks of oil products are rising rapidly as refineries turn excess crude into excess …
June was another strong month for China’s metals imports. In some cases, volumes dipped, but this may have been a response to rising prices rather than a sign of weaker underlying demand. … Higher prices could dampen China’s metals …
Higher demand from refineries helped to pull down crude stocks last week. But greater production of gasoline caused motor fuel inventories to rise. … US Weekly Petroleum Status Report (20th Jul. …
20th July 2016
World Steel Association (WSA) data, released this afternoon, show that global steel output was flat in year-on-year terms in June. But the weak start to the year meant that production still fell by 1.9% y/y in the first half of 2016. … Global Steel …
According to the International Aluminium Institute, global primary aluminium output declined by 1.2% y/y. However, daily average production continues to recover in response to rising prices. … Global Aluminium Production …
The metals, both industrial and precious, have been the star performers this month as investor sentiment improved. Meanwhile, the return of supply that had been lost to unanticipated outages weighed on the oil price. And while gold initially benefitted …
19th July 2016
The price of nickel has surged in recent weeks, primarily on concerns about lower supply due to greater regulation of ore mining in the Philippines. However, stocks remain high and demand is subdued at best, suggesting that the latest rally may fade. … …
18th July 2016
The prices of riskier assets, including industrial metals as well as equities, have been boosted by hopes of additional fiscal and monetary support to mitigate any global fallout from the UK’s vote to leave the EU. As it happens, we think expectations of …
15th July 2016
South Africa’s overall mine production remained subdued in May, but PGM output grew strongly. This perhaps reflects producers building up their stocks in preparation for the wage negotiations with trade unions that are now underway. … South Africa’s Mine …
14th July 2016
While inventories of US crude fell again last week on the back of falling net imports, sizeable increases in gasoline and distillate fuel stocks grabbed the headlines. … US Weekly Petroleum Status Report (13th Jul. …
13th July 2016
The return of production from Canada and Nigeria along with a potential increase in output from Libya over the next few months should put some downward pressure on prices. … Fewer disruptions to oil supplies should limit price …
China’s commodity import volumes continued to grow strongly in June, despite relatively subdued activity indicators. In some cases, arbitrage opportunities are encouraging Chinese buying but it also looks likely that fiscal and monetary stimulus measures …
Platinum group metals (PGMs) are primarily used in the automobile sector as catalysts for air pollution abatement in light- and heavy-duty vehicles. Auto sales in the three biggest markets, China, the euro-zone and the US, are now growing again after …
12th July 2016
Despite a spectacular 287,000 gain in non-farm payrolls in June, Fed funds futures are still only pricing in a 50% chance of a US interest rate hike by the end of 2017. This dovish spin allowed the price of gold to rebound on Friday after an initial …
8th July 2016
The slump in oil prices since 2014 poses a bigger threat to North Sea output than the UK’s vote to leave the EU (‘Brexit’). However, heightened uncertainty, potential tax changes and the possibility of another Scottish independence referendum could all …
US crude and gasoline stocks fell again last week, but the dramatic fall in US crude oil production has stolen at least some of the limelight. … US Weekly Petroleum Status Report (7th Jul. …
7th July 2016
The latest data suggest that gold demand from the official sector remained subdued in May. However, we expect this to be only temporary as central banks continue to diversify away from the US dollar. Gold’s appeal as a reserve asset also continues to be …
The UK’s decision to vote in favour of leaving the European Union in a nationwide referendum on 23 rd June – or ‘Brexit’ – has already boosted the prices of precious metals. The prospects for both gold and (riskier) silver over the coming years are …
6th July 2016
The price of palm oil rallied strongly in early 2016 on a combination of smaller harvests, rising soybean (and soy oil) prices and a rally in crude oil prices. These factors more than offset the negative impact of lacklustre demand. However, we forecast …
5th July 2016
The rally in coal prices over the past month has boosted investor sentiment. Admittedly, production in China, the US and Indonesia has finally started to fall. But prices have now risen to levels which may start to tempt some of that supply back to the …
We are now even more positive on aluminium demand in the near-term, based partly on our new Capital Economics Demand Proxy, but believe that supply growth will put a lid on prices by end-year. … Aluminium demand is stronger than often …
4th July 2016
The prices of both industrial and precious metals have jumped in the last month, despite falling initially in the wake of the UK’s vote to leave the EU on 23rd June. Prices subsequently recovered on hopes that signs of weak economic activity in China will …
The price of gold has predictably done well in the wake of the UK’s surprise vote to leave the EU (‘Brexit’). But the real star of the show has been silver, whose price has already jumped by nearly 20% in US dollar terms in the past month to within …
1st July 2016
Commodities outperformed equities in June as the UK’s surprise vote to leave the European Union sapped risk appetite in global markets. Gold prices predictably benefited from the heightened uncertainty, with silver the star of the month. But industrial …
