Commodity Capsule: Brent crude oil near 4-week high; gold edges higher; base metal rises

Commodity Capsule: Oil prices were hovering in a tight range near a week high on Tuesday amid a steady dollar, rising tensions in the Middle East, and cold weather United States disrupting output.

Brent crude futures hovers at $80 a barrel, the highest level since 27th December 2023.

Both the contracts had settled about 2 per cent higher on Monday.

Ukrainian drone strike on Novatek's Ust-Luga fuel export terminal raised supply concerns and drove up prices. 

In the Middle East, US and British forces have carried out a fresh round of strikes targeting a Houthi underground storage site, and missile and surveillance capabilities used by the Houthi group.

20 per cent of North Dakota's oil output remained shut in due to extreme cold and operational challenges.

Weighing on markets, are concerns over China's sputtering economic recovery, which is raising worries about global oil demand.

Chinese policymakers have rolled out a raft of measures to shore up the economy but domestic consumption remains tepid, leaving oil traders on edge about demand prospects.

Most base metals rose on Tuesday, buoyed by improved risk sentiment as China weighed measures to increase funding and stabilise its stock market.

Copper on the London Metal Exchange rose close to $8,380 per metric ton.

Chinese authorities are considering a package of measures to stabilise the slumping stock market, seeking to mobilise about two trillion yuan--Bloomberg News China's cabinet on Monday pledged to take more effective measures to stabilise market confidence, including stepping step up medium- and long-term fund injections in the capital market.

Gold prices edged higher on Tuesday, as the dollar slipped under the 103 mark.

Traders have been cautious about taking position ahead of interest rate decisions from a number of central banks and a slew of economic data in the US.

US gold futures moved higher towards $2,030 an ounce.

The US dollar index slipped away from over one-month high of 103.69 last week.

European Central Bank (ECB) meets on Thursday and is expected to hold monetary policy steady.

Federal Reserve officials last week said the US central bank needs more inflation data in hand before any rate cut judgment could be made and that the baseline for cuts to start was in the third quarter.

Fed officials are in a blackout this week ahead of the next meeting on Jan. 30-31, where they are expected to hold rates steady.

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