Tropical storm boosts increase in oil prices<\/p>\n
LONDON (AFP): The tropical storm over the Gulf of Mexico gave
\na badly needed boost to flagging oil prices last week in London,
\namid growing calls from OPEC for producers to stick to production
\ncuts and force up prices.<\/p>\n
Brent, the reference North Sea crude, gained almost 10 cents a
\nbarrel on the International Petroleum Exchange.<\/p>\n
The storm is threatening off-shore operations and production,
\nas well as the loading and unloading of tankers, prompting
\nrefineries to hoard reserves.<\/p>\n
In addition, Saudi Arabia, Kuwait and Qatar called on other
\nOrganization of Petroleum Exporting Countries to respect quota
\ncuts aimed at slashing production by 1.365 million barrels a day.<\/p>\n
Elsewhere on the commodities markets, base metals continued to
\nlose ground, mostly due to hefty increases in warehouse stocks of
\nthe London Metal Exchange.<\/p>\n
Gold: unwanted. Gold prices dipped towards the end of the week
\nas investors moved away from the financial safehaven as the
\ninitial storm around the release of the report into President
\nBill Clinton's sex and lies scandal eased.<\/p>\n
Gold closed on the London Bullion Market at about US$290.55 an
\nounce, down $4.5.<\/p>\n
Prices also slid in response to the recovery of the dollar
\nagainst the yen at the end of the week.<\/p>\n
However, gold found some support as a refuge against inflation
\nafter the U.S. Federal Reserve governor said he was concerned by
\nprice rises in the United States, analysts said.<\/p>\n
Silver: dip. Silver dipped by four cents to $4.94 an ounce on
\nthe London Bullion Market in the wake of gold.<\/p>\n
Palladium and platinum: flat. The two precious metals were
\nflat this week, following the delivery last week of the first
\npalladium supplies for 1998 to Japan.<\/p>\n
The first deliveries of platinum and sister metal rhodium were
\nto arrive in Japan in the coming days, Japanese traders said.<\/p>\n
Japan is the world's biggest importer of platinum group
\nmetals, while Russia is the biggest palladium producer and second
\nbiggest platinum producer, behind South Africa.<\/p>\n
Palladium was unchanged at $288 an ounce, platinum lost five
\ndollars to $358 an ounce.<\/p>\n
Copper: piled up. Copper prices on the London Metal Exchange
\nfell slightly this week, mainly due to a huge increase in LME
\nwarehouse reserves of 16,875 tons to 362,725 tons.<\/p>\n
Three-month copper fell $43 to $1,646.50 a ton.<\/p>\n
Japan's Nippon Mining announced plans for a 30,000 tons
\nincrease in capacity at its Saganoseki site, which produces
\n335,000 tons of copper annually.<\/p>\n
Nickel: dull. Three-month nickel prices weakened
\nsubstantially, losing $70 to $4,077.50 a ton, while LME warehouse
\nstocks rose 510 tons to 59,022 tons.<\/p>\n
Russia's Norilsk Nickel, the biggest producer in the world,
\nsaid its exports have not been affected by the country's
\npolitical and economic turmoil, something that would have driven
\nprices up.<\/p>\n
Tin: flat. Three-month tin fell $42.50 to $5,377.50 a ton,
\nwhile LME reserves rose 465 tons to 8,370 tons, amid quiet
\ntrading.<\/p>\n
Oil: hot. Brent, the reference North Sea crude, rose to about
\n$13.73 a barrel for October, up from $13.62 a week before, as
\nstorms in the Gulf of Mexico threatened delivery disruptions.<\/p>\n
Traders said the tropical storm was due to worsen, threatening
\nboth off-shore production in the gulf and tanker traffic.<\/p>\n
This has prevented investors from selling before the weekend,
\nwhile refiners are building up reserves in case the weather does
\nnot improve.<\/p>\n
In another boost for the flagging oil price, Kuwait, Qatar and
\nSaudi Arabia appealed to OPEC and non-OPEC producers to stick to
\ntheir agreements on reducing production quotas.<\/p>\n
In the medium term, the price of oil could average $12 to $16
\na barrel from $18 over the past 10 years, the company said.<\/p>\n
Rubber: flat. Rubber prices were stable this week, with
\nSeptember rubber on the London rubber index at 470 pounds a ton,
\nand October rubber at 475 pounds a ton.<\/p>\n
The RSS1 index in Kuala Lumpur rose slightly to 2.59 ringgits
\na kilo from 2.57 ringgits.<\/p>\n
Cocoa: cold. December cocoa prices on the LIFFE futures market
\nfell to 1, 013 pounds a ton from 1,071 pounds, amid continued
\nworry over the economic crisis in Russia, a major chocolate
\nconsumer, and Brazil's financial turbulence.<\/p>\n
Prices were also pressured by major selling from Ghana, the
\nworld's second biggest producer.<\/p>\n
Coffee: dark. Robusta coffee for November delivery fell
\nsharply to $1,598 a ton from $1,679 the previous week.<\/p>\n
Supply was expected to remain finely balanced until December,
\nwhen Vietman's 1998-99 harvest will hit the markets, traders
\nsaid.<\/p>\n
Indonesia is expecting a good 1999-2000 harvest, starting in
\nApril 1999. After having suffered major droughts this season,
\nproduction should increase by about 15 percent to 6.7 million
\nsacks next year.<\/p>\n
On the New York futures market, December Arabica coffee rose
\nto 101.85 cents a pound from 109 cents.<\/p>\n
Sugar: powder. White sugar prices rose this week on the back
\nof a 70,000 ton tender from Europe, as well as bargain hunting
\nafter last week's low prices.<\/p>\n
Prices also rose in response to a decline in expectations of a
\nBrazilian interest rates cut, which would have triggered massive
\nselling by Brazilian producers to compensate.<\/p>\n
Sugar on the LIFFE futures market for 1999 delivery closed at
\n$223.2 a ton, from $217.50.<\/p>\n
Grains: stale. The U.S. grains market picked up on technical
\nfactors at the end of the week.<\/p>\n
However, it was depressed by weakness on the international
\nfinancial markets and the lack of support from US Federal Reserve
\nChairman Alan Greenspan for a coordinated cut in interest rates
\nin G7 countries.<\/p>\n
European Union reform to wheat subsidies, threatening a blow
\nto US wheat sales in Europe, also hit sentiment.<\/p>\n
On the Chicago Board of Trade, September wheat rose five cents
\nto $2.53 for 27.2 kilos. September maize rose five cents to $1.95
\na bushel of 25.4 kilos.<\/p>",
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