[Fujitomi] Overseas crude oil surges, favorable to the bullish U.S. EIA inventory statistics
(New York Precious Metals)
On the 29th, New York gold fell slightly again. The nearby June gold futures settled at 1,256.80 dollars, down 2.00 dollars from the previous day, and the nearby July platinum futures settled at 956.30 dollars, down 4.40 dollars from the previous day.
In the Asian session, there was profit-taking ahead of quarter-end, and prices briefly fell to 1,250.00 dollars, but then held at 1,250.00 dollars despite the dollar’s strength. Uncertainty surrounding the Trump administration in the United States is raising concerns, and doubts about its implementation are beginning to emerge, with expectations that such risks will continue into the second quarter and beyond, which had been supportive of buying. The decline in the Dow Jones on the previous day also prompted bargain buying in the gold market, helping to hold 1,250.00 dollars. However, the upside remains heavy, and the range was narrow. Platinum also fell but managed to stay in the 950-dollar range for now. In the near term, adjustments at quarter-end are expected to keep support around 950 dollars, but a future reduction in industrial demand seems unavoidable, and the weak trend is expected to continue.
(WTI Crude Oil, NY Oil Products, North Sea Brent)
On the 29th, WTI crude oil surged. Nearby May WTI futures rose 1.14 dollars to 49.51 dollars, and nearby May North Sea Brent futures rose 1.09 dollars to 52.42 dollars. RBOB gasoline May futures rose 3.70 cents to 167.34 cents, and NY heating oil May futures rose 2.59 cents to 154.60 cents.
In the U.S. EIA stock data, crude inventories rose by 867,000 barrels from the previous week, while gasoline stocks decreased by 3,747,000 barrels and distillate stocks fell by 2,483,000 barrels. While the rise in crude inventories was below expectations, the larger-than-expected decline in petroleum product stocks led to a broad advance in the oil market. The nearby May WTI futures jumped from the mid-40s to the 49-dollar range and then showed a tendency to stay around 49 dollars. In particular, the strong momentum in New York gasoline, which had risen for several consecutive days, stood out and was seen as demand-driven. On the 20th, it rose above the 200-day moving average, providing strong support for WTI. However, U.S. crude production has increased for six consecutive weeks, so 50 dollars may become a significant resistance level. On the other hand, Libyan production cuts continue to provide support.
(CBOT Soybeans)
CBOT soybeans for the 29th declined at month-end due to caution ahead of the USDA’s prospective plantings and U.S. stocks report. Nearby May futures fell 2.50 cents to 969.50 cents, and new-crop November futures fell 4.25 cents to 968.00 cents.
The prospective planting area and U.S. stocks as of March 1 are seen as quite bearish for soybeans, and that bearish stance is expected to linger beyond April. With heavy pressure from South American bumper crops, Chicago soybeans remain prone to further declines, and rallies are likely to be limited, offering selling opportunities. The large increase in U.S. soybean planting area projected for 2017 is expected to continue expanding future supply glut, and depending on the report, November May fall below 9.50 dollars at once.
(CBOT Corn)
CBOT corn on the 29th showed mixed trading. Nearby May futures rose 0.25 cents to 358.00 cents, and new-crop December futures fell 0.25 cents to 381.50 cents.
USDA’s planting area and U.S. stocks data, together with position adjustments ahead of quarter-end, continue. Nearby May futures recovered to the 3.60-dollar area but failed to fully recover. Expectations for a reduction in supply glut are low, and bearish data could prompt downside risks. Rain is forecast in the U.S. corn belt from the weekend into next week, seen as helpful moisture but still a potential pressure. First, we wait for the USDA report.
https://www.fujitomi.co.jp/?p=14079
