Commodities are stable in the early hours amid the weaker dollar. After gaining for two consecutive trading days, crude oil prices are stronger in early hours on Friday. Crude oil is trading at one-month high price levels. Crude oil might close the day with profits.
Market awaits producers’ meeting
The market is looking forward to OPEC and non-OPEC producers’ meeting on May 25 in Vienna. Producers are expected to make a decision about extending the supply cut agreement. Recently, Saudi Arabia and Russia’s energy ministers commented about extending the supply cut agreement by nine months. Their comments increased speculation in the market about extending the supply cut beyond mid-2017. As a result, increased optimism is supporting the crude oil price rally. The sentiment also improved due to the EIA’s recent inventory report, which showed a decline in inventory levels.
The market is looking forward to the release Baker Hughes’s oil rig count report, which is scheduled to release at 1:00 PM EST today. At 7:00 AM EST, West Texas Intermediate crude oil futures contracts for June 2017 delivery were trading at $49.92 per barrel—a gain of ~1.2%. Brent crude futures contracts for July 2017 delivery rose ~1.1% and were trading at $53.09 per barrel. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) closed at $34.69 after falling 0.06% on May 18.
After losing momentum in the last two days, copper regained strength and traded higher in the early hours. The sentiment in the copper market improved amid China’s announcement of the “Silk Road” project with infrastructure spending of $124 billion. Copper is also supported by the weaker dollar in the early hours. The PowerShares DB Base Metals ETF (DBB) fell 0.57%, while the SPDR S&P Metals & Mining ETF (XME) fell 0.94% on May 18. Gold prices are slightly weaker in the early hours amid improved global sentiment, while silver is stable. Platinum is stable, while palladium struggles to move higher in the early hours.