USCF logo

Weekly Commodities ETF Report: OPEC Output Curbs, Rising US Production Weigh on Oil; Gold Slumps on Strong Jobs Data; Geopolitical Concerns and Trade War Fears Wane

(MT Newswires) – -Crude ended in negative territory for the week — suffering its lowest finish since April, following reports of rising US production as well as the possibility that the Organization of the Petroleum Exporting Countries and its allies would taper production curbs, if not outright boost crude output to help offset output losses from Iran and Venezuela. On Wednesday, the Energy Information Administration reported that US crude supplies fell by 3.620 million barrels for the week ended May 25, confounding expectations for a draw of just 400,000 barrels. But, monthly data on Thursday showed that US crude production increased 2.1% to 10.474 million barrels a day in March, up from February. It was also up 14.6% from March 2017. Meanwhile, officials from Saudi Arabia had expressed their intent to step up production gradually while maintaining its quota agreement with OPEC. Earlier in the week, the organization has said it would maintain its output cuts. Finally, Baker Hughes’ (BHGE) rig count report showed the number of oil rigs operating in the US jumped by 2 to 861 — the third consecutive week of gains and near the highest level since mid March 2015.

Over the last five days, light, sweet crude oil for July delivery was down 2.71% and closed at $65.81 per barrel. In other energy futures, gasoline fell during the week, down 1.13% and settled at $2.14 per gallon at the close of Friday’s session. Meanwhile, natural gas edged 0.37% higher this week and was up in Friday’s session at $2.96 per 1 million British thermal unit.

The SummerHaven Dynamic Commodity Index Total Return Index (SDCITR) rose 0.45% this week, from a decline of 0.69% in the previous week.

Gold ended the Friday session lower, settling at $1,299.30; and finished the week 0.70% lower. In the first half of the week the yellow metal benefitted from its safe haven appeal, as concerns over developments in Italian politics, as well as more trade war fears, drove most traders away from equities. But equities took a higher turn on Friday, and gold slumped after Italian politicians agreed on a coalition government, averting the prospect of a snap election and ending the uncertainty in the eurozone’s third-largest economy. Back home, strong US jobs data also helped buoy stocks, with nonfarm payrolls rising ahead of expectations with a gain of 223,000 in May versus estimates for a 190,000 rise. The unemployment rate firmed at 3.8% versus estimates for 3.9% and also 3.9% for the previous month. Meanwhile, aluminum and copper made modest gains following President Donald Trump’s announcement of new US tariffs on  imports of steel and aluminum from three of its biggest trade partners — Canada, Mexico and the European Union. The European Union said it will open a case with the World Trade Organization questioning the tariffs, while Canadian Prime Minister Justin Trudeau said Canada will also file a challenge to the levies with the WTO, calling the tariffs “illegal and counterproductive.” Copper rose 0.41% for the week and closed Friday’s session at $3.09 per pound; aluminum had a weekly rise of 1.37% and settled at $2,292 per ton.

Agriculture commodities ended the week mostly mixed, with grains trading mostly lower: corn was down 3.87% in the week and settled at $3.92 per bushel in Friday’s session; soybeans had a weekly decline of 1.70%, closing at $10.21 per bushel on Friday; and wheat was down 3.95% for the week and settled at $5.23 per bushel at the end of Friday’s session. Meanwhile, sugar had a weekly gain of 0.32% and settled at a price of $0.12 per ton on Friday; coffee was at $1.23 per pound at Friday’s close, with a weekly gain of 1.79%; and cocoa fell 4.03% for the week and closed Friday’s at $2,458. Cocoa prices slumped this week after the International Cocoa Organization lowered its global production estimates and boosted its demand forecasts for the 2017-2018 season, according to a report on MarketWatch. The organization said in its quarterly report that in 2017-18 cocoa supply will surpass demand by just 10,000 metric tons, a decline from the 105,000-ton surplus it forecast at the end of February. The ICC also said it projects production to be  4.587 million tons, a 3.3% annual drop.

The SummerHaven Dynamic Agriculture Index Total Return Index (SDAITR) rose 3.13% for the week, compared with an increase of 1.80% in the prior week.

 

Copyright © 2018 MT Newswires, www.mtnewswires.com.

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

Investing involves risks, including loss of principal.

Commodity ETP Disclosures:  Download a copy of a Fund’s Prospectus by clicking one of the following:
USCIUSAGUSOUSLUSOUDNOUSODBNOUNGUNL, UGAUHN, or CPER  

Please read any Prospectus carefully before investing.

These Funds are not mutual funds or any other type of Investment Company within the meaning of the Investment Company Act of 1940, as amended, and are not subject to regulation thereunder.

Commodity trading is highly speculative and involves a high degree of risk. Commodities and futures generally are volatile and are not suitable for all investors. Investing in commodity interests subject each Fund to the risks of its related industry. An investor may lose all or substantially all of an investment. These risks could result in large fluctuations in the price of a particular Fund’s respective shares. Funds that focus on a single sector generally experience greater volatility. Leveraged and inverse exchange-traded products pursue daily leveraged investment objectives which means they are riskier than alternatives which do not use leverage. They are not suitable for all investors and should be utilized only by investors who understand leverage risk and who actively manage their investments. For further discussion of these and additional risks associated with an investment in the Funds please read the respective Fund Prospectus before investing.

Please read the Prospectus carefully before investing.

Performance is historical and does not guarantee future results; current performance may be lower or higher. Investment returns/principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Most recent performance is available at www.uscfinvestments.com.

Past performance does not guarantee future results.

This information is intended for U.S. residents.

Funds distributed by ALPS Distributors, Inc. 

USCF logo

Weekly Commodities ETF Report: Uncertainty Over US-North Korea Summit Key Driver in Oil, Gold Commodities; OPEC Output Curbs Weigh on Energy Sector

(MT Newswires) – – Geopolitical worries were central to much of the movement in commodities and funds associated with them, tracking global equities this week. Foremost of these concerns was the uncertainty over whether a US-North Korea summit would push through or not. On Thursday, US President Donald Trump withdrew from what would have been a historic summit with North Korea’s Kim Jong Un. North Korea’s response to the developments was somewhat measured, with a senior official from Pyongyang saying the North Korean leader was still willing to meet with Trump. For his part, Trump praised North Korea’s response to the cancellation of the much-awaited summit as “warm and productive” — hinting yet again, the meeting could happen after all, according to a report in the UK’s The Telegraph.

Energy commodities were on a downward trend for most the week, trading firmly in negative territory amid developments surrounding the US-North Korea summit. Moreover, speculation that OPEC-led output curbs could be relaxed at a June meeting further weighed on the energy sector, with reports that Saudi Arabia and Russia plan to ease production limits to offset shortfalls from Iran and Venezuela. On Wednesday, the Energy Information Administration reported a massive increase in crude oil stockpiles, with US oil inventories jumping 5.8 million barrels, versus expectations of a 2 million barrel drawdown. Gasoline stockpiles also rose according to the EIA, hinting that US drivers are resisting $3/gallon at the pump. The American Petroleum Institute had previously reported that US crude supplies fell by 1.3 million barrels for the week ended May 1. The API data, however, showed an unexpected rise of 980,000 barrels in gasoline stockpiles. Crude oil slumped further on Thursday when the Trump administration launched an investigation into whether imports of cars, trucks and auto parts threatened US national security. The final bit of data for the energy sector is Baker Hughes’ (BHGE) rig count report, which showed the number of oil rigs operating in the US jumped by 15 to 859, its highest level since March 13, 2015. The combined oil and gas rig count in the US rose by 13 to 1059 as gas rigs fell by two to 198.

Over the last five days, light, sweet crude oil for July delivery was down 5.50% and closed at $67.880 per barrel. In other energy futures, gasoline fell during the week, down 2% and settled at $2.17 per gallon at the close of Friday’s session. Meanwhile, natural gas edged 3.30% higher this week and was down in Friday’s session at $2.86 per 1 million British thermal unit.

The SummerHaven Dynamic Commodity Index Total Return Index (SDCITR) fell 0.69% this week, from an increase of 1.34% in the previous week.

Gold ended the Friday session lower, settling at $1,309.00, but held on to modest gains to finish the week 0.62% higher. Uncertainty over the US-North Korean summit had previously boosted the yellow metal higher as traders were driven to safe havens. Downbeat economic data throughout the week also helped mild gains, including a bigger-than-expected decrease in new orders for US manufactured durable goods in the month of April; a decline in durable goods orders in April; and a modest deterioration in US consumer sentiment for the month of May. Meanwhile, copper also eked out gains, ending the week up 0.47%; earlier declines were driven by the uncertainty surrounding the meeting between the US and North Korea, as well as a higher greenback. The red metal recovered somewhat by Friday, settling at $3.08 at the end of the regular session.

Agriculture commodities ended the week mostly in the positive territory, led by grains: corn was up 1.10% in the week and settled at $4.06 per bushel in Friday’s session; soybeans had a weekly rise of 4.43%, closing at $10.42 per bushel on Friday; and wheat was up 5.07% for the week and settled at $5.43 per bushel at the end of Friday’s session. The gains in soybeans followed news that China had resumed importing soybeans from the US. According to a report on Reuters, a Chinese importer had purchased one cargo of US soybeans for August shipment — the first sale of US soybeans to China since the two countries had engaged in a so-called trade war in past few weeks. Meanwhile, wheat prices remained near 10-month highs on concerns over dry weather in key global producing regions.

The SummerHaven Dynamic Agriculture Index Total Return Index (SDAITR) rose 1.80% for the week, compared with a decline of 1.02% in the prior week.

Copyright © 2018 MT Newswires, www.mtnewswires.com.

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

Investing involves risks, including loss of principal.

Commodity ETP Disclosures:  Download a copy of a Fund’s Prospectus by clicking one of the following:
USCIUSAGUSOUSLUSOUDNOUSODBNOUNGUNL, UGAUHN, or CPER

Please read any Prospectus carefully before investing.

These Funds are not mutual funds or any other type of Investment Company within the meaning of the Investment Company Act of 1940, as amended, and are not subject to regulation thereunder.

Commodity trading is highly speculative and involves a high degree of risk. Commodities and futures generally are volatile and are not suitable for all investors. Investing in commodity interests subject each Fund to the risks of its related industry. An investor may lose all or substantially all of an investment. These risks could result in large fluctuations in the price of a particular Fund’s respective shares. Funds that focus on a single sector generally experience greater volatility. Leveraged and inverse exchange-traded products pursue daily leveraged investment objectives which means they are riskier than alternatives which do not use leverage. They are not suitable for all investors and should be utilized only by investors who understand leverage risk and who actively manage their investments. For further discussion of these and additional risks associated with an investment in the Funds please read the respective Fund Prospectus before investing.

Please read the Prospectus carefully before investing.

Performance is historical and does not guarantee future results; current performance may be lower or higher. Investment returns/principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Most recent performance is available at www.uscfinvestments.com.

Past performance does not guarantee future results.

This information is intended for U.S. residents.

Funds distributed by ALPS Distributors, Inc.