Sparking fresh supply fears

Oil market jumps on Yemen unrest

GMT 06:37 2015 Saturday ,28 March

Arab Today, arab today Oil market jumps on Yemen unrest

Yemenis stand at the site of a Saudi air strike
London - Arab Today

World oil prices rose sharply this week as Saudi Arabian jets struck rebel targets in Yemen, sparking fresh supply fears in the crude-rich Middle East.
Many commodities were also buoyed as weak US data sent the dollar sliding, denting confidence in the world's top economy and throwing into question the timeline for a long-awaited Federal Reserve interest rate hike.
The dollar sank as US data showed an unexpected drop in durable goods orders. The flagging greenback makes dollar-denominated raw materials cheaper for buyers using stronger currencies, which tends to stimulate demand and prices.
OIL: Prices rallied on Wednesday and Thursday after a Saudi Arabia-led coalition bombed Huthi Shiite rebels in support of Yemen's embattled President Abedrabbo Mansour Hadi.
New York crude struck a one-month high of $52.48 and Brent oil jumped to a March 9 peak of $59.78 on Thursday.
Crude futures began soaring as Hadi was rushed to a secure location after a warplane attacked his presidential complex.
"The geopolitical tensions in Yemen are pushing (oil) prices higher," Daniel Ang, an investment analyst with Phillip Futures, told AFP.
"Yemen is not a big producer but it is a trade hub in the region so tensions over there could cause a disruption in the trading activities for energy products," said the Singapore-based analyst.
Yemen -- bordered by key Middle East oil producers Saudi Arabia and Oman -- has been gripped by growing turmoil since the Shiite rebels launched a power grab in Sanaa in February.
The oil market then fell on Friday, trimming its gains owing to no disruption to oil supplies.
"Oil prices ... are shedding some of the strong gains they had achieved over the two previous days," said Commerzbank analyst Carsten Fritsch.
"It would appear that the initial panicky response to Saudi Arabia's military intervention in Yemen is giving way to a more sober assessment of the situation."
Warplanes from the Saudi-led coalition kept up raids against Huthi Shiite rebels on Friday as Hadi headed to an Arab summit to garner support.
There are concerns that an escalation of the conflict could disrupt oil shipments passing through the Bab el-Mandeb Strait, located between Yemen and Djibouti and through which about 3.8 million barrels of oil per day are transported.
Oil gains were capped by fears over the global supply glut, which was made worse by the 11th straight weekly increase in US crude inventories.
The US Department of Energy said commercial crude reserves rallied 8.2 million barrels in the week to March 20, smashing expectations of 4.7 million.
Rising inventories tend to push prices lower because they indicate weakening demand in the world's biggest crude consuming nation.
Oil has collapsed by as much as 60 percent in value since June on the back of a burgeoning supply glut.
By Friday on London's Intercontinental Exchange, Brent North Sea crude for delivery in May stood at $57.81 per barrel compared with $54.99 a week earlier.
On the New York Mercantile Exchange, West Texas Intermediate or light sweet crude for May leapt to $50.16 from $46.17 for the expired April contract a week earlier.
-Weak dollar propels gold -
PRECIOUS METALS: Gold rallied Thursday to $1,220.11, the highest level since early March, on the weak dollar and as investors sought safety from unrest in Yemen.
"A perfect storm of supporting news has driven the yellow metal to a three-week high," said Saxo Bank analyst Ole Hansen.
"The dollar, equities and bond yields are all trading lower while safe-haven demand related to the last 24 hours events in Yemen have also been lending support."
Gold is traditional regarded by investors as a safe bet in times of geopolitical uncertainty.
By Friday on the London Bullion Market, the price of gold rose to $1,195.75 an ounce from $1,183.10 a week earlier.
Silver rallied to $17.14 an ounce from $16.17.
On the London Platinum and Palladium Market, platinum gained ground to stand at $1,138 an ounce from $1,129.
Palladium declined to $748 an ounce from $778.
BASE METALS: Base or industrial metals rose, boosted by the sliding dollar, while star performer copper hit $6,294.50 -- the highest since early January -- on supply woes in Chile.
"In Chile, the world’s largest copper mining producer, many mines had to discontinue production temporarily after torrential rainfall made access roads impassable and caused partial power supply disruptions," said Commerzbank analysts.
By Friday on the London Metal Exchange, copper for delivery in three months rose to $6,069 a tonne from $5,945 a week earlier.
Three-month aluminium climbed to $1,778.50 per tonne from $1,784.
Three-month lead advanced to $1,829 a tonne from $1,752.
Three-month tin firmed to $17,285 a tonne from $17,150.
Three-month nickel increased to $13,375 a tonne from $13,035.
Three-month zinc edged higher to $2,081.50 a tonne from $2,023.50.
- Soft commodities mixed -
COCOA: The commodity gained some ground but remained under pressure from weak demand.
"The lack of demand is especially noticable in Asia, where a lot of new production and processing capacity has been installed in the last year or two," noted Jack Scoville, analyst at Price Futures Group.
By Friday on LIFFE, London's futures exchange, cocoa for delivery in May climbed to £1,927 a tonne from £1,911 a week earlier.
On the ICE Futures US exchange, cocoa for May increased to $2,750 a tonne from $2,700 the previous week.
COFFEE: Prices diverged as traders tracked prevailing weather conditions in key producer Brazil.
"Recent rains have improved the prospects for this year’s Brazilian harvest," said research group Capital Economics in a market commentary.
"However, continued dry conditions in the main Robusta-growing region are likely to see Robusta production fall."
Coffee remains under pressure with Brazil's real currency trading around 12-year dollar lows.
By Friday on ICE Futures, Arabica for delivery in May dipped to 139.90 US cents a pound from 142.65 cents a week earlier.
On LIFFE, Robusta for May edged up to $1,804 a tonne from $1,791.
SUGAR: New York prices on Friday neared a six-year trough at 12.22 US cents, the lowest since April 2009, on abundant supplies and favourable weather in key producer Brazil.
"With every day that passes, reaching 12 cents is looking ever more likely," said broker Czarnikow.
"There is not too much positive news out there at the moment.
"Rainfall in Brazil has been well above average over March, helping out with cane development and quashing any fears over dry weather at the beginning of the year."
By Friday on LIFFE, a tonne of white sugar for delivery in May firmed to $362.90 from $361.30 a week earlier.
On ICE Futures US, unrefined sugar for May dropped to 12.31 US cents a pound from 12.50 US cents.
Rubber: Prices rose slightly amid tepid demand.
The Malaysian Rubber Board's benchmark SMR20 on Friday rose to 141.35 US cents a kilo from 140.15 US cents a week earlier.
Source: AFP

Arab Today, arab today
Arab Today, arab today
arabtoday arabtoday arabtoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabs, Arab, Arab