Oil rises on Libyan supply disruptions, likely OPEC output cut extension - 29 Mar 2017

Commodity Intraday Tips
Gold investment seen rising for 4th year in 2017 -CPM.
Gold bullion investment will rise for the fourth straight year in 2017 as global political and economic factors are forecast to maintain buying interest, CPM Group said on Tuesday. "There has been a return of opportunistic generalist investors who had exited gold in late 2011 and early 2012," New York-based CPM Group said in its Gold Yearbook 2017. CPM forecast gold bullion investment at 17.6 million ounces in 2017, up from 17.4 million ounces in 2016 and the highest since 2012 when it was 29.2 million ounces.

The independent commodities research company pegged global gold coin demand at 7.5 million ounces in 2017, up from 7 million ounces in 2016 and the highest since 2013. "Most long-term gold investors do not seem to expect the world's financial and political systems to collapse. Rather, they see them as facing major structural problems that will not be easily resolved or repaired in any short period of time," CPM said.  The lack of clarity regarding the outcomes of U.S. President Donald Trump's campaign promises and interest rate increases by the Federal Reserve to raise interest rate hikes is expected to prevent precious metals prices from taking a clear direction in 2017, CPM said.

Chile's Cochilco Raises 2017 Copper Price Forecast after Supply Disruption.
Chile's state copper commission Cochilco revised up its copper price forecast for 2017 after supply disruption at world’s large copper mines.  Cochilco estimated that global copper demand will grow by 2-3 percent this year, and the world’s copper market will see a supply shortage of 200,000-250,000 tones’ after supply contraction at Escondida and Grasberg.  Sergio Hernandez, Executive Vice-President of Cochilco, forecast on Tuesday in an interview in Santiago that average copper price will be at $2.5-2.55 per pound in 2017, up from the projection of $2.4 in January.

India's major nickel scrap prices declined on the Scrap Register Price Index as on Monday, while nickel futures prices at India's Multi Commodity Exchange settled down by 1.12 percent to Rs. 637.10 per kilogram. MCX Nickel settled down tracking weakness from nickel prices at London Metal Exchange, which sank 2.2 percent extended selling from last week.

Oil rises on Libyan supply disruptions, likely OPEC output cut extension.
Oil prices on Wednesday extended gains from the previous session, lifted by supply disruptions in Libya and expectations that an OPEC-led output reduction will be extended into the second half of the year. Both crude benchmarks rose by more than 1 percent the previous day production from the western Libyan fields of Sharara and Wafa has been blocked by armed protesters, reducing output by 252,000 barrels per day (bpd), a source at the National Oil Corporation (NOC) told Reuters late on Tuesday. (Libya), along with the Iranian oil minister saying there is likely to be an extension to the production cut deal helped crude oil rally overnight," said Greg McKenna, chief market strategist at futures brokerage AxiTrader.

The Organization of the Petroleum Exporting Countries (OPEC), along with some other producers including Russia, have agreed to cut production by almost 1.8 million bpd during the first half of the year in order to rein in a global fuel supply overhang and prop up prices. But as markets remain bloated halfway into the cuts, there is a broad expectation that the supply cuts will be extended into the second half of the year the rising consensus of extended cuts, the OPEC-led strategy to re-balance oil markets is not without controversy.

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