Commodities Are Weak amid the Dollar’s Strength
After falling for five consecutive trading weeks, crude oil prices paused the downfall last week amid improved market conditions. Maintaining the strength, crude oil rose on Monday. However, it traded with weakness in the early hours on September 12.
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The market sentiment improved this week as Hurricane Irma weakened. The market lost strength during Hurricane Harvey due to refinery damage. There were doubts about the demand outlook in the impacted areas. The market regained strength last week as some of the refineries resumed their operations. As the week progressed, the market lost strength amid warnings about Hurricane Irma. Hurricane Irma was downgraded to a Category 1 tropical storm and oil regained its strength. The market is trading with weakness before the American Petroleum Institute’s weekly crude oil inventory report today.
At 6:40 AM EST on September 12, the West Texas Intermediate crude oil futures contracts for October 2017 delivery were trading at $47.84 per barrel—a fall of ~0.48%. The Brent crude oil futures contracts for November 2017 delivery fell 0.07% and traded at $53.80 per barrel. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) closed at $30.17 after rising 0.94% on September 11.
After starting the week on a stronger note, copper prices pulled back in the early hours on Tuesday and traded with weakness. Increased warehouse levels in the LME (London Metal Exchange) along with the firm dollar and profit-booking are weighing on copper prices today. According to recent LME copper positions data, a decrease in the net copper long positions was observed but at the highest levels since December.
Gold (GLD) and silver (SLW) are weaker in the early hours on Tuesday. The improved global market sentiment and the firm dollar are weighing on gold. A firm dollar weighs on the prices of dollar-denominated commodities like gold, silver, and copper. Platinum is weak, while palladium is stable in the early hours on September 12.