Crude oil.
Crude oil futures quotations closed above the level of 80 dollars per barrel at Wednesday\'s auctions on the back of unexpected US oil stock reduction and also the American currency fall to annual lows versus the Euro.
According to the trading results at the New York Commodity Exchange, the December sweet crude oil futures quotations ticked up by 80 cents, or by 1%, to 80.40 USD per barrel. Brent futures rose in price by 78 cents, or by 1%, to 78.89 USD per barrel.
As Energy Information Administration attached to Department of Energy reported on Wednesday the oil reserves contracted by 3.9 million barrels on the week ended October, 24-30, while analysts were waiting for stocks gain. The oil and fuel reserves have been showing a decrease the fourth sequential week, and it strengthened investors’ expectancies that the demand for energy would swell as far as the economy recovery.
By the way, reserves decline has insignificant connection to demand improving. Last week the oil refinery plants sharply curtailed petroleum import as they shrank fuel production dramatically. The gasoline and distillate stocks greatly enlarged during last several months and its surplus impair profitable refining ventures.
The oil market garnered additional support during the last minutes before closing of the deals, when it became known that the FRS will continue to carry out the policy of extremely low interest rates. This means that the US dollar more likely remains weak against other majors. The oil prices, which are calculated in dollars, often rise, when the dollar weakens because in this case the oil will become cheaper for customers in other currencies.
Gold.
Gold futures quotations renewed the record maximum level during Wednesday deals, but dropped from it by the end of the session as traders shortened positions prior to the report of the FOMC.
According to the trading results on COMEX, the subdivision of the New York Commodity Exchange, the December gold futures quotations, trading most extensively, ticked up by 2.40 USD to 1087.30 USD per ounce. During the deals the December gold futures reached the new record high for trading most actively contracts at the mark of 1096.50 USD. The November gold futures quotations gained the record high for contracts with spot delivery month at 1094 USD.
On Tuesday gold prices sharply moved up amid the statements that the Reserve Bank of India bought 200 metric tons of gold from overall volume of 403.3 tons, rendered by the IMF for sale in order to finance the credit programs for poor countries . This deal was taken as sign of a strong demand for gold from central banks and also moderated fears about that gold sales by the IMF could negatively affect the precious metals market.
Kind regards,
Analyst: Vladimir Donin.
