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Weekly Commodities ETF Report: Crude Ends Week Higher as OPEC Keeps Output Cuts; Gold Rises as Investors Rush to Safe Haven Following Mass Shooting in New Zealand

(MT Newswires) – Crude prices ended Friday’s session lower following four days of consecutive gains, but ultimately closed the week in positive territory as global crude supplies appear to be tightening. Earlier in the week, Saudi Energy Minister Khalid al-Falih pledged that the Organization of the Petroleum Exporting Countries (OPEC) and allies would keep output cuts in place through June. Looking ahead, the OPEC and non-OPEC Joint Ministerial Monitoring Committee will gather in Baku, Azerbaijan over the weekend, with an official meeting set for Monday to review how much members and ally countries have been complying with production cuts. Back home, the Energy Information Administration’s weekly report showed that US crude stockpiles fell by 3.9 million barrels, at odds with expectations for a build of 2.5 million barrels. This also compares with the American Petroleum Institute’s report that US crude oil stocks showed a draw of 2.6 million barrels. Finally, energy services firm Baker Hughes (BHGE) reported Friday that the number of oil rigs operating in the US fell by 1 to 833, the lowest level since April 27, 2018. The count has also fallen by 20 in the past three weeks. The combined oil and gas rig count in the US also slipped by 1 to 1,026 as gas rigs were flat 193.

Light, sweet crude oil for April delivery rose 4.25% for the week, settling at $58.52 per barrel at the end of Friday’s session. In other energy futures, gasoline was up 2.72% during the week, settling at $1.86 per gallon on Friday. Natural gas fell 2.47% this week and closed down Friday at $2.80 per 1 million British thermal unit.

The SummerHaven Dynamic Commodity Index Total Return Index (SDCITR) was 0.74% higher this week, compared with a decline of 0.93% in the previous week.

Gold wrapped up the Friday session higher, settling at $1,302.90; for the week, it rose 0.23%. A weaker dollar, as well as geopolitical concerns over Brexit uncertainty and news of a mass shooting at two mosques in New Zealand, which resulted in 49 deaths and several injuries, have driven traders into safe- haven assets like gold. Renewed optimism for a US-China trade deal has also boosted the yellow metal, following a report from China’s official news agency saying the Chinese government and Trump administration have made progress in trade talks. On the other hand, copper closed Friday’s session at $2.91 per pound, edging 0.29% higher for the week. The red metal recovered from weakness earlier in the week, following news that industrial output in China fell to a 17-year low in the first two months of 2019.

In agriculture commodities, grains ended the week higher: corn rose 2.40% in the week and settled at $3.73 per bushel in Friday’s session; wheat rose 4.96% and settled at $4.62 per bushel at the end of Friday’s session; and soybeans were up 1.59% for the week, and closed Friday in positive territory at $9.09 per bushel. Corn ended the week with its largest gains since early January, with prices rising because of concerns for planting delays. The cold soil and muddy fields could impede the crop’s planting, while the weather could also hinder farmers’ efforts to fertilize their cornfields. Meanwhile, wheat saw its biggest weekly gain in more than three months, mostly due to short-covering.

Other commodities were mixed: sugar had a weekly increase of 3.20% and settled at a price of $1.25 per pound on Friday; coffee was around $0.98 per pound at Friday’s close, down 0.91% for the week; and cocoa inched 0.27% higher for the week and closed Friday’s session at $2,197 per tonne.

The SummerHaven Dynamic Agriculture Index Total Return Index (SDAITR) was down 2.19% for the week, widening from the prior week’s decline of 0.94%.

 

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Information Contact: Justin Hillstrom – 720.917.0770 Email: Justin.hillstrom@alpsinc.com, Website is www.uscfinvestments.com

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