Commodity Capsule: Brent crude oil range bound; gold prices fall | Watch video

Commodity Capsule: Copper prices cool off 2-year highs, hovering under $9,800 a ton.

Copper prices fell further from recent two-year highs as weak economic readings and fears of high-interest rates somewhat offset optimism over tighter markets.

Earlier this week, LME copper hit two-year highs, after stricter western sanctions on Russian metal exports pointed to tighter markets.

But this optimism was dulled by top copper producer Chile signaling that state-owned copper miner Coldeco will increase output in 2024.

Concerns over steady demand weighed after US PMI data read weaker than expected for April, with the manufacturing sector back in contraction territory.

Yangshan premium has dropped to zero for the first time on record, indicating a weak appetite to import copper into China, following a surge in prices.

Meanwhile, the red metal has downside support from relentless fund buying.

A slightly weaker dollar index helped make greenback-priced metals cheaper to holders of other currencies.

Goldman Sachs forecast global refined copper market is likely to see a deficit of 428,000 tons in 2024. GS expects copper prices to hit $12,000/T within the next 12 months.

GS Sees $2700/t 12m Price Targets And $2850/t 2025 Price Average For Aluminium.

Oil prices were range-bound on Thursday as falling fuel demand in the US amid signs of a slowing economy contended with concerns for widening conflict in the Middle East producing region.

Brent crude futures hold around $88 a barrel, after falling 0.5 per cent in the previous session.

WTI crude futures for June dipped under $83 a barrel, following a 0.6 per cent drop on Wednesday.

US Energy Information Administration on Wednesday showed gasoline demand in the week to April 19 dropped 2.8 per cent week-on-week and is down 11 per cent year-on-year.

Distillate fuel demand also declined from a week ago and is down 4.7 per cent from a year ago.

The falling fuel demand is occurring amid signs of cooling US business activity in April and as stronger-than-expected inflation and employment data means the Federal Reserve is more likely to delay expected interest rate cuts, weighing on economic sentiment.

Crude stocks slumped by 6.4 million barrels to 453.6 million barrels-- EIA.

Gold prices fell on Thursday as waning safe haven demand and the prospect of higher-for-longer US interest rates battered the yellow metal.

Bullion prices were nursing a sharp drop from record highs over the past week, as potential conflict between Iran and Israel did not escalate as markets were fearing.

Waning safe haven demand left gold vulnerable to headwinds from U.S. rates, given that higher-for-longer rates push up the opportunity cost of investing in bullion.

Gold futures expiring in June fell to $2,320/ounce.

Strength in the dollar pressured metal prices.

Gold’s next leg of movement is expected to be driven largely by more upcoming cues on the US economy and interest rates.

First-quarter US GDP data due later on Thursday is expected to show whether the economy remained resilient at the beginning of 2024.

PCE price index data is likely to have a bigger impact on gold, given that it ties directly into the central bank’s outlook on interest rates.

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