Crude oil started this week on a weaker note and continued the four-week losing streak. The prices fell to the lowest in a month on Monday. Crude oil prices started Tuesday with a weak market sentiment. In the early hours on August 29, crude oil is trading below the opening prices.
Crude oil’s market sentiment is weak this month amid oversupply concerns and doubts about increased demand later in 2017. In addition to these factors, Hurricane Harvey is another factor that’s weighing on crude oil prices this week. Floods inundated the refineries located along the Gulf Coast in Texas, which caused 15% of the US refinery capacity to shut down. Amid expectations of extended periods of flooding and an increase in supply disruptions, crude oil prices are falling on Tuesday. Generally, supply disruptions support oil prices given the oversupply situation. However, the positive movements from supply disruptions were offset by demand concerns from the Gulf Coast region amid the floods.
At 6:40 AM EST on August 29, the West Texas Intermediate crude oil futures contracts for October 2017 delivery were trading at $46.51 per barrel—a fall of ~0.13%. The Brent crude oil futures contracts for November 2017 delivery fell 0.7% and traded at $51.06 per barrel. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) closed at $29.58 after falling 0.6% on August 28.
Copper started this week on a positive note and followed a seven-week rising streak. On Monday, copper rose to the highest levels since September 2014 due to the weaker dollar and high demand expectations for copper in the coming months. On Tuesday, copper opened the day with strong market sentiment and traded at elevated levels. The weaker dollar on Tuesday is also supporting copper prices. Gold (GLD) and silver (SLW) are strong in the early hours on August 29 amid increased demand for safe-haven assets and the weaker dollar. Gold is trading at 11-month high price levels in the early hours on Tuesday. The weaker dollar supports the prices of dollar-denominated commodities like copper, gold, and silver. Platinum and palladium are strong in the early hours on August 29.