Commodity Roundup: Drone strikes on Russian refineries keep oil supported; gold down

Oil prices rose on Thursday, after EIA data pointed to a drop in U.S. crude oil and gasoline stocks, while repeated attacks on Russian refineries by Ukraine, including a strike on Rosneft’s (OTC:RNFTF) biggest oil refinery, also kept prices supported.

U.S. gasoline futures (XB1:COM) eased slightly after registering their biggest price increase across the energy complex, after EIA said energy firms pulled a much larger-than-expected 5.7 million barrels of gasoline from stockpiles last week.

The Organization of the Petroleum Exporting Countries, led by Saudi Arabia, meanwhile, stuck to its forecast for oil demand growth of 2.25 million barrels per day in 2024, higher than many other forecasts. The producer group also raised its global economic growth forecast for this year, saying that there was more room for improvement.

Turning to precious metals, platinum, silver, and gold futures ticked lower against a stronger dollar, as markets braced for U.S. producer price data and further clues on the inflation trend ahead of next week’s Federal Reserve meeting. Spot gold (XAUUSD:CUR) was down -0.20% at $2,169.98 an ounce by 6:10 am ET.

“A correction is unfolding, possibly taking gold down to support at $2,134 but could quite likely dip down to the 0.382 retracement at $2,114,” Saxo Bank said. “To totally negate the bullish picture, a daily close below $2,016 is necessary. However, a close below $2,064 could be the first indication of that scenario playing out,” it added.

In the physical market, India has allowed its central bank to import gold without paying import levies, the government said in a notification issued late on Tuesday, as per report.

Gold importers from the world’s second-biggest gold consumer need to pay basic customs duty and Agriculture Infrastructure and Development Cess. As of September 2023, the Reserve Bank of India held 800.79 metric tonnes of gold, including gold deposits of 39.89 tonnes, the report added.

Copper prices (HG1:COM) too edged lower after rising to their highest in seven months in the previous session, following Chinese plans to cut output. “We see copper prices moving higher in the second quarter (which is seasonally the strongest quarter of the year) to average $8,500/t from an average of $8,400/t in the first quarter,” ING analysts said in a note.

Separately, Reuters reported, iron ore prices were coming under pressure from a combination of fundamental and sentiment factors in dominant importer China that are likely to persist over the short term. The price of Singapore Exchange iron ore contracts dropped to $110.05 a metric ton on Wednesday, the lowest close since Aug. 31 and down 23.4% from the peak so far in 2024 of $143.60, reached on Jan. 3.

Stocks to watch: Flotek Industries (FTK) +30%, PBF Energy (PBF) +9%, Imperial Petroleum (IMPP) +8%, CVR Energy (CVI) +7%, ProFrac Holding (ACDC) -7%, Dawson Geophysical Company (DWSN) -7%, Cameco (CCJ) -6%, Liberty Energy (LBRT) -6%.

Recent Commodity Price Movements and A look At Some ETFs