Crude oil prices rose on Tuesday on a combination of renewed worries about supplies from Nigeria and concerns about US gasoline supplies approaching summer.
ICE June Brent rose 55 cents to $68.20 a barrel after a Nigeria worker was killed and six foreign oil workers were kidnapped by armed militants. The attack forced Chevron to shut down 15,000 barrels a day of production from the Funiwa oilfield.
Oil output from Nigeria has been reduced by one- fifth – around 500,000 barrels a day – due to attacks by militants and traders remain concerned about the possibility of further violence following the recent presidential elections which were marred by accusations of vote rigging.
Nymex June West Texas Intermediate added 5 cents at $65.71 a barrel in choppy trading ahead of US inventories data on Wednesday which are expected to show gasoline stocks declining for a twelfth consecutive week.
A poll of analysts by Reuters forecast that gasoline stocks fell 0.7m barrels last week while crude stocks were expected to have risen 1.4m barrels. Nymex RBOB June gasoline rose 1.6 cents to $2.2750 a gallon.
The recent launch of two exchange traded funds has led to renewed speculative interest in platinum, off 0.5 per cent at $1,283 a troy ounce on Tuesday. A third and larger ETF aimed at US investors may be about to be launched which could tighten the market even further.
MiningMX reported that a large US bank had contacted Impala Platinum to ask its views.
“The concern we have is that if a big fund in the US decides to go for it, and the liquidity or backup needed to support that ETF is not there, then $1,500 is around the corner,” said Derek Engelbrecht, marketing director at Impala.
John Reade, head of metals strategy at UBS, said US retail interest was not strictly necessary to change platinum’s price dynamics.
“Platinum’s available stocks are so limited that only about 500,000 ounces of buying would be necessary to force the price materially higher. This could occur from institutional demand without any need for retail money,” Mr Reade said.
Gold slipped 0.6 per cent to $673.60 a troy ounce, under pressure from a recovery in the dollar prompted by the US ISM manufacturing survey.
Trading volumes for base metals were lighter than normal due to holidays in Europe and Asia. Shanghai’s markets are closed until next Tuesday for Golden Week holidays.
However, copper rose to within a whisker of the key $8,000 level and traders said that some dealers were taking advantage of thin market conditions to push prices higher to flatter mark to market valuations on their trading books.
Copper rose 3 per cent to $7,995 a tonne, helped by a fall of 650 tonnes in LME stocks.
Strike action by miners in Peru, which started on Monday, gained only lukewarm support with more talks between unions and government scheduled for yesterday. Peru’s labour minister said less than five per cent of Peru’s miners had gone on strike.
The government is to declare the strike illegal from Thursday which will allow companies to sack workers that have been absent for three days.
Zinc gained 3.6 per cent at $3,890 a tonne after a fall of 1,225 tonnes in LME stocks while nickel added 1.9 per cent at $48,700 a tonne and lead held above the $2,000 level at $2,105 a tonne.