Brent crude lost 3.4%, or $2.54, at $71.05 a barrel.WTI shed $2.64, or 3.6%, at $69.17 a barrel.
Natural gas delivery for July climbed by Rs 3.30, or 1.21%, to Rs 276.90 per mmBtu.METALS:
Spot gold added 0.2% to $1,814.38 per ounce. On MCX, silver lost 1.52% or Rs 1,056.
Copper declined by 1.2% at $9,315 a tonne.AGRICULTURAL:
Corn and soybean prices recovered due to buoyant spot demand.
Oil prices drop after OPEC closed the deal
Oil prices are falling on Monday morning. It followed OPEC+’s deal yesterday to increase production when the economic recovery is causing an increase in demand.
The group managed to overcome the impasse of the last meeting in which the United Arab Emirates (UAE) blocked an agreement for intending to review the productions. This Sunday, and August approaches – the month in which an increase in production by the group members and their allies was expected, an agreement has already been reached.
In reaction, oil prices are now decreasing. Brent crude was trading with a loss of 3.4%, or $2.54, at $71.05 a barrel. Meanwhile, WTI shed $2.64, or 3.6%, at $69.17 a barrel. Both benchmarks recorded their most significant declines since early April.
The members of OPEC will increase a maximum of 400,000 barrels a day each month until any previously established cut is reversed and production levels restored.
The agreement will also give the Emirates, Iraq and Kuwait higher production quotas as of May 2022.
Natural gas prices are surging
Liquefied natural gas prices are on the rise worldwide. Increased demand in China and other parts of Asia is helping benchmark prices in Europe to reach decade highs.
On the other hand, US prices have surged due to hot weather and the US gas export boom.
US prices have also risen, partly due to hot weather and an LNG export boom. It suggests that a fully integrated international market is finally developing even though the US price remains far cheaper.
Indian LNG demand also hiked sharply in 2020 and economic recovery will further boost it this year. Besides, domestic upstream gas projects are seeing delays.
On the MCX, natural gas delivery for July climbed by Rs 3.30, or 1.21%, to Rs 276.90 per mmBtu.
Gas delivery for August was raised by Rs 3.20, or 1.17%, to Rs 276.30 per mmBtu.
Treasury yields slide supports gold
Gold is gaining ground as US treasury yields dropped. Besides, worries about the delay in global economic recovery because the Delta variant has increased demand for the precious metal.
Spot gold added 0.2% to $1,814.38 per ounce today. US gold futures increased by 0.1% at $1,816.40.
According to analysts, if the gold price continued the downward movement and lost $1,798.9 and then turned back towards the level, we could consider the 1,795.0 level as support.
If it continues to decline, the next support level resides at $1,780.6.
Benchmark 10-year Treasury yields plummeted to a near two-week low at 1.2640%. It reduced the opportunity cost of holding gold.
The World Gold Council has signed an agreement with the Gem and Jewelry Export Promotion Council of India to increase the popularity of gold jewellery in 2021.
A strong dollar pressures silver
Silver dropped below Rs 68,000 per kg due to a strong increase in the dollar.
Last week, on MCX, the white metal lost 1.52% or Rs 1,056.
According to CFTC data, speculators lowered their net long positions in silver futures and options positions by 879 contracts to 34,678 in the week of July 13.
Silver holdings in the iShares ETF declined by 40.36 tonnes to 17,226.74 tonnes. It was the first fall in four days.
Copper falls on demand concerns
Worries about demand in China weighed on copper prices.
Benchmark copper CMCU3 on the LME declined by 1.2% at $9,315 a tonne. China’s moves to prevent the rally is a significant reason behind copper’s more than 10% dip since touching a record high of $10,747.50 a tonne in May.
Market participants stated that the increase in Delta variant cases and the potential for economic disruption had added to the gloomy outlook for industrial metals.
Corn and soybean prices hike
Chicago corn futures recovered last week. Hot weather kept speculators uncertain about the U.S. harvest.
Most-active corn futures surged more than 4% in the final two days of the last week. Money managers lessened their net long in corn futures and options to 208,799 contracts from 219,371 a week earlier.
As for the soybeans, the commodity price increased by Rs 88 to Rs 8,225 per quintal in the futures market. Traders created fresh positions pursuing buoyant spot demand.
On the National Commodity & Derivatives Exchange, futures contracts for soybean July delivery increased by 1.08% or Rs 88, to Rs 8,225 per quintal.
Marketmen said raising new positions by speculators on the back of higher demand mainly led to a surge in soybean prices.
0 (0 votes)
Get the latest economy news, trading news, and Forex news on Finance Brokerage. Check out our comprehensive trading education and list of best Forex brokers list here. If you are interested in following the latest news on the topic, please follow Finance Brokerage on Google News.