A summary of trading in key commodities markets overseas:
ENERGY
Crude oil prices rallied Wednesday in parallel with stocks on the back of a significant, unexpected drop in US oil stockpiles.
Signs that EU leaders might be coming together on a way to protect banks and contain the Greek debt crisis also helped drive the rebound, as traders looked past lacklustre economic data in Europe and the United States.
In New York, the WTI crude contract for November surged $US4.01 to $US79.68 a barrel.
In London, Brent North Sea crude headed back over the $US100 a barrel line after dropping below it on Tuesday for the first time since early February.
The main London contract for November delivery ended at $US102.73 a barrel, $US2.94 higher from Tuesday.
Crude oil stocks fell by 4.7 million barrels last week, according to data from the Energy Information Administration, compared to expectations of a figure of around 700,000 barrels.
In Bucharest, the government announced that two Irish firms had obtained oil and gas drilling rights in Romania.
Blackstairs Energy will drill in six blocs and Moesia Oil and Gas in one, Prime Minister Emil Boc said.
Seven blocs have been explored by Romania’s Petrom, part of Austria’s OMV group, and Romgaz, but they gave up on them after finding little oil and gas.
PRECIOUS METALS
Gold rose after dipping below $US1,600 an ounce as stock markets appeared to have found their footing, but traders said the metal’s correlation with volatile equities could trigger more selling.
Mediocre US service-sector and private-employment data followed grim figures on the euro zone’s services sector, contributing to a choppy session as investors deliberated over whether bullion is a shelter from turmoil or a speculative trade that will rise with riskier assets.
Ultimately, the mildly upbeat mood in stock markets – which recovered after European officials agreed to shore up euro zone banks against the region’s debt crisis – lifted bullion.
Spot gold was up 0.5 per cent at $US1,628.10 an ounce by 12.06pm EDT (0306 Thursday AEDT), off a low of under $1,600.
US gold futures for December delivery were up $US14.30 at $US1,630.40 an ounce, with volume sharply below the norm, as traders braced for more volatility after gold’s sharp pullback from a record above $US1,920 an ounce set in September.
Even though bullion had dropped as much as 20 per cent from its record, gold-backed exchange-traded funds have not seen significant outflows, suggesting ETF investors have played no significant role in the slump, Commerzbank said in a note.
Silver was up 1.1 per cent at $US30.25, after having fallen as much as five per cent to a low of $US28.40 an ounce.
Spot platinum fell 1.1 per cent to $US1,448.50 an ounce, while palladium turned higher, up 0.5 per cent at $US552.72 an ounce.
BASE METALS
Copper ended up for the first time in six sessions, supported by a weaker US dollar and encouraging data from the United States that allowed the market to find some footing from weeks of heavy losses.
Copper extended its upside push in after-hours trade, tracking sweeping gains across the broader commodity complex that helped fuel a near two-per cent bounce in the Reuters-Jefferies CRB index from its lowest levels in nearly a year on Tuesday.
Still, copper remained pinned below the $US7,000 per tonne level for a third consecutive day as macro pressures continued to dog sentiment, prompting one investment bank to forecast a price below $US5,500 ($US2.49/lb) in the months ahead.
London Metal Exchange (LME) three-month copper edged up $US20 to end at $US6,820 a tonne. In after-hours trade, gains pushed the price back above $US6,900.
In New York, the key December COMEX contract eked out a 0.25-cent gain to settle at $US3.1060 per lb, and pushed through the $US3.12 level in electronic business.
Copper prices were down more than 30 per cent from their mid-February records at $US10,190 per tonne and $US4.60 per lb — well into bear market territory and low enough to attract more Chinese business.
Sentiment also received a boost from US data showing private-sector employers added a better than forecast 91,000 jobs in September and the Institute for Supply Management’s service index topped forecasts.
Still, all eyes remained fixed on Europe and developments in its handling of its sovereign debt crisis. Global equities rebounded on signs that European authorities are moving forward with a pledge to prop up the region’s struggling banks.
Chile’s Codelco, the world’s top copper producer, was offering lower annual physical copper premiums for European buyers for 2012, down by nearly nine per cent on this year’s terms, trading sources said.
The lowering of the annual premiums suggested consumers were wary but still willing buyers, trading sources said.
China, the world’s biggest consumer of copper, is away this week for a national holiday, but even prior to the break, the Chinese have not really aggressively bought the metal despite it falling to 14-month lows.
