In the global economic recovery expectations, and the support of oil-producing countries to cut production measures, international oil prices rose more than 6% last week, standing on a year high, and into the $ 60 per barrel price level. Analysts believe that the fundamentals of the oil market remains sound, but based on the recent surge, the near future may enter a consolidation.
In Crude Oil and agricultural products and other raw materials prices driven by the rise in commodity prices this year to outperform global stock markets, the market is also expected to increase fiscal stimulus measures, central banks will maintain an accommodative monetary environment, and the continued economic recovery and look good. However, analysts reminded that commodities are also facing a strong dollar in the short term, technical indicators show that will be in consolidation and other risks.
Bloomberg information reported that the Bloomberg Commodity Spot Index, which tracks global commodities such as corn to oil, rose 6.2% this year, outperforming the MSCI AC World Index, a global stock market indicator, which rose 3.8% over the same period.
Countries are beginning to administer the new crown vaccine, which will help the global economy recover from the impact of the new crown pneumonia outbreak, supporting the commodity market rally.
Other positive also include central banks will also maintain monetary policy easing, the United States is ready to launch a larger bailout program, as well as copper and other major raw materials are still in short supply.
International oil prices have risen about 15% this year, mainly because of the decline in global oil inventories, and the Organization of the Petroleum Exporting Countries and partner countries (OPEC+) to comply with the production cut agreement. April Brent crude futures climbed 6.2 percent last week to $59.34 a barrel, nearing the $60 mark, the highest in a year, while March West Texas Intermediate futures also rose 9 percent on a weekly basis to close at $57.29 a barrel.
Agricultural prices also rose, with Chicago corn futures rising 13% this year, soybean futures up 3.9% and cotton futures climbing 5.9%.
Prices of most base metals also rose, with tin prices hitting a six-year high last week and writing the longest-ever weekly gain of 14 weeks in a row, as demand for electronics increased and a coup in Myanmar, a major producer, raised supply concerns; the dollar fell last week, providing support for metal prices, with copper prices closing up 1.1% on Friday, erasing last week’s losses.
Silver prices did rise sharply for a few days last week as retail investors pulled up, with silver coins selling out, but the short-rolling market that retail investors tried to drive did not work, with New York silver futures up 0.39% last week and up 2.3% for the year. Gold has fallen 4.4% this year, mainly because of the global economic recovery hopes rise, inhibiting the attractiveness of gold.
Analysts pointed out that the commodity outlook will face several headwinds, including a stronger dollar and the relative strength indicators (RSI) continue to be located in the overbought area, indicating that the market will enter a consolidation period.
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