Commodities Trading: 24 January 2014
As widely expected, US stockpiles of crude oil distillates plunged as the cold weather increased demand for heating.
According to the US Department of Energy, inventories of distillates tumbled by 6 times more than the consensus estimate of 0.5 million barrels.
Therefore, despite the opening of the southern leg of the Keystone pipeline, the price of US crude oil gained $0.70 to $97.34 as traders factored in the greater demand.
A steep fall for the US dollar sent gold prices rallying yesterday, with the market closing $27.1 higher at $1,264.21, the strongest level since 10 December.
Some less encouraging US economic numbers reminded investors of alternative assets, especially at a time when the precious metal has recently lost around 30% of its value.
Commodities Trading: 23 January 2014
As heating needs in the US have risen lately, driven by the record low temperatures, investors are expecting that the distillate fuel inventories will slump.
After the delay of the Martin Luther King holiday, the US Department of Energy will release its weekly report today and it remains to be seen whether the expectations will be confirmed.
Nevertheless, the US crude oil futures
market continued to rally, gaining $1.46 to close at $96.66.
Gold slumped for the second day in a row yesterday, losing $4.3 to settle at $1,237.1.
Given the recent good US economic data, the likelihood of the Fed continuing to reduce its monetary stimulus is keeping any rally in precious metal under close scrutiny.
Commodities Trading: 22 January 2014
Speculation that crude product inventories in the US are on a decline spurred continued buying in crude oil for the third day in a row.
Nymex prices were also helped by a belief that US oil demand is on its way up anyway and so the market rallied by $1.29 to close at $95.21 per barrel.
The gold market slumped by $14 yesterday to $1,241.3 as investors weighed the bullish influence of heightened physical demand against signs of ongoing Fed tapering.
It certainly seems that this clash will continue to define the precious metal's trajectory over the short-term.
Commodities Trading: 21 January 2014
Fresh concerns that a slowdown for the Chinese economy would reduce demand for crude oil pushed WTI prices $0.24 lower to $93.99.
This proved to be short lived however, as China added more cash into the system last night, poised to deal with any short-term blips and keep its population in work.
An ongoing increase in the physical demand for gold
, especially from Asia, pushed the metal $1.8 higher yesterday to $1,255.
It appears that the demand for bars, coins and jewellery has managed to offset the plunge sparked by the improvement in the US economy over the last few months.
Commodities Trading: 20 January 2014
The WTI crude prices gained just 13¢ last Friday to close at $94.28 as an improved economic outlook offset fears of oversupply, especially from non-OPEC countries.
The overnight report showing that China, the world's second largest oil consumer, has seen its industrial output slowing down is already taking its toll on the market.
For once, better news on the US economy did not trigger another slump in gold prices.
On the contrary, following comments by the President of the Federal Reserve Bank of Minneapolis saying that officials 'need to do more' to stimulate growth, gold prices rallied $11.6 to $1254.00.
The information and comments provided herein under no circumstances are to be considered an offer or solicitation to invest and nothing herein should be construed as investment advice. The information provided is believed to be accurate at the date the information is produced.
By Jonathan Sudaria, 24 January 2014