Commerzbank was among the analysts in the past week to note a noticeable tightening in both platinum group metals.
“In our opinion, risks to supply in conjunction with robust demand point to higher platinum and palladium prices,“ the bank said in an Apr. 3 report on platinum and palladium.
“According to data from Johnson Matthey, the supply-demand situation was already tight on both markets last year. Assuming the supply problems are not resolved in the near future and demand remains robust, the situation on both markets will doubtless tighten further,” Commerzbank said.
The bank envisages a platinum price of $1,600 an ounce by the end of this year, while it expects palladium likely to be trading at $825 an ounce.
July platinum futures on the Comex division of Nymex closed at $1,438.30 an ounce on Apr. 9, some $12 down on last week’s finish. Comex palladium futures for June reached $802.45 an ounce on Mar. 24, a level not seen for the most-active contract since Aug. 3, 2011. On Apr. 9, June palladium settled at $782.55 an ounce, down $8.2 on last week’s finish.
U.S. gold futures also slipped lower again this week after touching a one-week high on Apr. 3. June gold climbed to $1,306.55 an ounce on Comex following the release of the latest U.S. nonfarm payrolls report. The data showed the country added slightly fewer jobs than expected in March.
But the precious metal slipped back below $1,300 an ounce on Apr. 8 with June gold settling at $1,298.30 an ounce but still more than $18 off the seven-week low of $1,280.30 recorded by the most active contract on Apr. 1. June gold finished at $1,305.90 on Apr. 9.
Comex gold prices have been under heavy selling pressure in recent weeks as upbeat U.S. economic data fuelled expectations that the Federal Reserve will begin to raise rates sooner than previously thought.
U.S. crude futures climbed to their highest in a month after a government report showed rising gasoline demand reduced the country’s stocks of the fuel. U.S. oil prices were also underpinned by stronger equities and a weaker dollar after minutes from the Federal Reserve’s last meeting, released on April 9, eased concern about the timing of future interest rate hikes.
Worries that fresh tensions in eastern Ukraine could impact the flow of oil from Russia also supported prices.
West Texas Intermediate (WTI) crude, the U.S. crude benchmark, for May delivery rose $1.04 to $103.60 a barrel on the New York Mercantile Exchange (Nymex) on Apr. 9, the highest settlement since Mar. 3.
The government’s Energy Information Administration (EIA) said gasoline demand averaged 8.8 million barrels a day in the week to Apr. 4, up by 4.4 percent from the same period last year. Inventories of the fuel fell by 5.2 million barrels to 210.4 million barrels.
U.S. commercial crude stocks increased by 4.0 million barrels from the previous week, reversing the prior week’s inventory fall, EIA data showed, but crude inventories at the key Cushing, Oklahoma storage hub showed another decline in the week to Apr. 4.
However, the decline of 300,000 barrels to 27.3 million barrels was one of the smallest since TransCanada Corp.’s Gulf Coast pipeline began commercial lifting on Jan. 23. The pipeline runs from the Cushing hub to Nederland, Texas. Much of the 14.5 million barrels stock drawdown at Cushing since late January has been attributed to the start-up of the pipeline.
Brent crude futures, the European benchmark, moved up to near $108 a barrel by midweek on the rising tensions in eastern Ukraine and their potential to impact Russian oil supplies. These geopolitical concerns overshadowed the hefty unexpected rise in U.S. crude stocks.
Brent crude for delivery in May on London’s ICE Futures Europe exchange settled at $107.98 a barrel on Apr. 9, having touched $108.08 earlier in the day. May Brent finished last week at $106.72 a barrel. However, traders said Brent’s gains are being capped by the possibility that Libyan oil flows would rebound following the surrender of control of two oil terminals by Libyan rebels to the government.
Bloomberg reported the ports of Hariga and Zueitina were surrendered to the government after an Apr. 6 deal. However, the opening of the two other ports held by the rebels, Ras Lanuf and Es Sider, depends on agreement on revenue sharing and development measures still to be reached, according to the Bloomberg report, which quoted a Libyan lawyer mediating between the two sides.
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