LONDON (ShareCast) – (ShareCast News) – Oil and gold slipped to fresh lows in Europe on Friday, at the end of a testing week with the Greek debt crisis finally showing signs of a conclusion, Iran nuclear talks ending positively and Beijing’s regulatory measures stopping a free-fall in the Chinese equities market. Oil benchmarks stayed firmed in the red on oversupply concerns though sharp declines failed to materialise in wake of Iran’s settlement with world powers earlier in the week. That said, despite there being little immediate prospect of a flood of Iranian barrels, industry surveys still point to oversupply being in the region of 1.1m to 1.3m barrels per day (bpd).
Bearish sentiments got further entrenched with the publication of Saudi Arabia’s latest production data earlier this week, which rose to a record of 10.56m bpd according to independent surveys and 10.35m bpd if OPEC statistics are to referred to.
At 16:01 BST, the Brent front month futures contract for September delivery was down 26 cents or 0.46% at $ 56.66 a barrel, while the WTI fell 61 cents or 1.20% at $ 50.30.
Slide in gold markets continued to ensure five successive days of negative trading, with the COMEX gold for August delivery down 1.09% or $ 12.50 to $ 1,131.40 an ounce, trading at nine-month lows. Spot gold also took a hammering shedding 1.12% or $ 12.86 at $ 1132.53 an ounce.
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Roland Khounlivong, head of dealing and settlements at GoldMoney, said, “Gold’s see-saw relationship with the US dollar has meant that as it strengthened this week, so gold went south.” “Helping the swing was Chairwoman of the US Federal Reserve Board, Janet Yellen, who said the raising of interest rates there is very much on the agenda. She also confirmed that the US economic recovery is on track and won’t be worried by the situation in Greece or the shaky Chinese stock market.” Base metals saw a mixed end to the week on the London Metal Exchange. Past the midway point in the session, the three-month tin futures contract was rallying to $ 15,712.50 per tonne, up 3.7% or $ 562.50. Lead (up 0.3%) was also in the green. However, primary aluminium (down 0.9%), copper (down 0.8%), nickel (down 0.4%) and zinc (down 0.2%) slipped into red.
Finally, on the agricultural commodities front, CBOT corn (down 1.80%), wheat (down 2.00%) ICE cocoa (down 0.18%), cotton (down 0.48%) and CME live cattle (down 0.31%) futures contract were all in the red.
