Commodity Exchange: Week Ended November 3, 2023





By Chinedu Okoye


Commodity Exchange:

·        A look at last weeks price movements in commodities focusing on  Gold, Silver, Crude Oil, Natural Gas, Palm Oil and Copper.

·        Whilst most commodities had wild price and volatility price swings the commodities selected have traded sideways. Some notable downward trends were also captured.

·         

 

Commodity

Previous Close

Last week Close

Change %

Gold

2006.38

1992.65

 -0.68%

Silver

23.25

23.21

 -0.17%

Natural Gas

3.48

3.39

 -0.26%

Palm Oil

3775.00

3768.00

 -0.19

Brent

 

WTI

90.48

 

85.54

85.25

 

80.39

 -5.7%


-6.02%

Copper

8009.00

8175.00

 -2.03%

 (Data from Bloomberg)

 

Gold:

Gold closed the week ending November 3, at $2006.38, even though it touched lows at about 1980 levels before bouncing back to 1992.65 on Friday. The yellow metal was trading at $1985.01 as at the time of the writing. The swings in gold prices are supportive of a buy the dip strategy for the yellow metal and additional purchases of physical stocks of gold for High Net-worth Individuals.

With markets pricing in an end to interest rate hikes, we’ve seen yields reverse its upward trend across all durations in the same week. The inverse relationship between both

(source: investing.com)


Silver:

Silver started the week at 23.25 and after goibto as low as 21.95, I think ended the week at 23.21 losing only five basis points, it gained 0.28% to start this week at 23.27. Whether or not the metal has found a floor at the 21. Level is left to be seen.

 

(Source: investing.com)


Natural Gas:

Natural Gas opened the week at $3.394 after wild upswings taking it to $3.57 at some point in the week. Geopolitical tensions in the Middle East, Russia’s  cut in oil and gas sales o Europe also contribute to the wild upswings we are experiencing in Natural Gas.

 

(source: investing.com)


Brent Crude:

 Brent Crude ended last week at $85.25, a 3.5% drop from the $90.48 from the revious weeks close. It opened at $85.34 a .53% increase from Fridays close. 

 

 

(Source: investing.com)

WTI:

The West Texas Intermediate benchmark price movement as indicated in the charts above and below, mirors the that of Brent Crude. 

 

(source: investing.com)

The price difference between both oil bench marks from last week's close (indicated by the table above), and this week's open (indicated in the charts), show a modesr spread change (i.e the premium at which Brent sells relative to WTI) staying close at 4.31 a 63 cents drop from the previous close on November 3. 

Contraction in Brent-WTI spreads are indicative of demand strength and a signal for a price increases. It shows an demand from Europe for US Oil, in the face of higher prices from OPEC producers. 

Hence the increase in WTI ricyes or decrease in Bent Crude rices, closing the gap. It is on this note that a bullish case for Oil is made in the short to medium term. 

 

 

 

 

 

 

 

 

 

 

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