Crude oil prices are off 6-week highs, still trading in the positive and holding around $70 per barrel mark. There is also some buying returned in metals after three weeks of decline in the space.
Trade tensions between US and China have eased as the two are looking at negotiations on the import tariffs.
There has been a big move in crude market. The global trade conflict going on at the moment is certainly providing a lot of volatility and has some pretty wide ramifications for the oil market, said Daniel Hynes, Senior Commodity Strategist at ANZ Research.
“I think the market certainly is in a position where it could certainly spike higher due to the declining inventories and the real possibility of geopolitical risk causing some sort of supply side disruption”, he said.
“The issues around the trade conflict certainly rises the risk of the US becoming even tougher on Iran and the renegotiation of that nuclear agreement”, he added.
Navneet Damani of Motilal Oswal Commodities discusses with Manisha Gupta the current trend in commodities markets.
Here are all the latest updates for you from the commodity space:
The decline in equities seems to be bothering commodity as an asset class as well. This has affected crude oil prices as they slipped on global cues.
The Chinese Iron ore market hit a four-month low on Monday falling by over 4% as high inventory levels and a weak domestic steel market weighed on prices.
A broad weakness in US Dollar is also expected.
Crude oil prices seem to be holding on a strong note today after it witnessed a decline for the last two days. The commodity has gained strong support from China with its industrial output going up by 7% in the first two months of this year.
However, US weekly inventories showed lower than the estimated rise at 1.2 million barrels. In a statement, IEA said that the global output would exceed 100 million barrels in Q2 2018. But, it would match the demand only in Q3 of the year.
Crude oil prices have slipped ahead of the US weekly inventory data. Speculators seem to be cutting long position in anticipation. Market experts expect US crude oil prices to range between $58 to $63, anticipating that the US crude oil would trade for the whole year.
Markets have been reacting to Trump’s decision on imposing import tariff on steel and aluminium, exempting Canada and Mexico. However, EU, Australia and Japan have been asking to be exempted.
Pressure on gold prices has increased as they have declined on the gains of equity market whereas, silver prices witnessed support from industrial demand.
Watch Manisha Gupta of CNBC-TV18 updating on all the action from commodities and currency space.