[Fujitomi] International crude oil prices fell sharply from the high and continued to decline

（NY Precious Metals）
On the 5th, New York gold continued to advance, but the gains were shrinking, and the upside was notably heavy. The New York Gold Near-Term August contract rose 2.5 dollars from the previous week’s close to 1282.7 dollars, while the New York Platinum Near-Term July contract rose 4.2 dollars to 957.6 dollars.
At the start of the week, NY gold hovered around the 1280-dollar level, but buying to push the price higher was lackluster; after hitting a high of 1286.0 dollars, it slid to 1280.2 dollars. On the 8th, there were warnings about congressional testimony by former FBI Director Comey, the UK general election, and in early next week the severance of diplomatic ties between Qatar and five countries including Saudi Arabia and Egypt, which could heighten Middle East tensions. While risk factors suggested a potential sharp rise, the strong stock market and expectations of a June U.S. rate hike kept gains in check, resulting in a heavy-to-the-top price action. In the near term, attention is on whether the 1280-dollar level can be maintained.

(WTI Crude Oil, NY Petroleum Products, North Sea Brent)
On the 5th, WTI crude oil continued to fall, briefly slipping below $47. The near-term July WTI contract was down 0.26 dollars from the previous week’s close at 47.40 dollars, and the near-term August Brent contract was down 0.49 dollars at 49.46 dollars. RB0B Gasoline July was down 3.90 cents at 153.81 cents, and NY Heating Oil near-term July was down 2.55 cents at 145.93 cents.
Saudi Arabia, Egypt, the UAE, Bahrain, and Yemen announced severance of ties with Qatar on the grounds of supporting terrorism. At first the news was seen as positive for the market, combining with technical buying, and stop-loss orders pushed WTI near July past 48 dollars to 48.42 dollars in a sharp rise. However, the 48-dollar level did not hold, retreating to negative territory during the European session, and dropping below 47 dollars again the previous week’s close. Qatar is a member of OPEC and participates in coordinated production cuts, but markets warned of a possible misalignment in those cuts. On Monday, the CEO of Russia’s largest oil company Rosneft indicated that the coordinated production cuts were a failure, providing another selling signal. With U.S. crude production trends not reversing, selling was triggered by weak fundamentals, yet the price managed to rebound to the 47-dollar area thanks to the prior week’s lows. The steep drop in NY oil products contributed to the larger decline in Brent linked to them.

(CBOT Soybeans)
On the 5th, CBOT soybeans ended the day with a mixed performance. The near-term July contract fell 0.25 cents to 921.00 cents, while the new-crop November contract rose 1.25 cents to 926.75 cents.
During the Asian session, prices rose, supported by the previous week’s strong demand, but world supply remained ample, and prices subsequently declined. The U.S. Department of Agriculture’s weekly export inspection data fell short of expectations, bringing the near-term July contract under 9.20 dollars. However, expectations of future export improvements due to a weaker dollar provided some support, allowing the price to rebound to the 9.20-dollar area. The average anticipated progress rate for U.S. crop planting, before the Chicago close, was 81% (vs. 67% the previous week).

(CBOT Corn)
On the 5th, CBOT corn traded in a narrow range and was bought back toward the close, showing a modestly firmer tone. The near-term July contract was up 0.25 cents from the previous week’s close at 373.00 cents, and the new-crop December contract was up 1.00 cent at 392.00 cents.
In a tight range of buying and selling, the market showed a technically-driven pattern, maintaining the 20-day moving average and displaying unexpectedly solid support. Although favorable weather forecasts for the U.S. Corn Belt were noted, improvements in crop conditions anticipated in the next report were expected to be limited, making selling less attractive. Regarding the crop condition report to be released after the Chicago close, the market’s consensus was that 67% of the total good-to-excellent and excellent ratings were expected (vs. 65% the previous week). The general view is that crop improvements will be seen in the next report.
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