Commodity Capsule: Brent crude oil rises; gold set for best week; copper cools

Commodity Capsule: Oil prices rose in early trade on Friday following a decision by OPEC+ to keep its oil output policy unchanged.

Crude oil managed to claw back some losses from the previous trading session triggered by ceasefire reports between Israel and Hamas.

Brent and WTI crude futures settled more than 2 per cent lower on Thursday. Both the benchmarks are headed for over 5 per cent decline this week; Their first in three weeks.

In the region, attacks by Yemen's Houthi forces on vessels in the Red Sea have continued to disrupt global trade, spurring geopolitical tensions and shipping concerns. 

OPEC+ has kept its oil output policy unchanged and will decide in March whether or not to extend the voluntary oil production cuts in place for the first quarter.

OPEC+ has output cuts of 2.2 million barrels per day in place for the first quarter, as announced in November.

Gold prices on Friday were set for their best week in seven weeks.

Dollar and Treasury yields retreated, while traders awaited US jobs numbers due later in the day to gauge the timing on when the Federal Reserve could start cutting interest rates.

Global gold futures for April edged to a one-month high past $2,070 per ounce. The contract is set for its best weekly gain since late December

The yellow metal surged as data from the US Labor Department showed initial jobless claims rose more than expected last week.

A separate report showed that U.S. worker productivity grew faster than expected in the fourth quarter.

Investor focus will shift to the U.S. non-farm payrolls data due Friday

Bullion was supported by concerns over the regional banking sector in the US

Yields on benchmark 10-year Treasury notes languished near their lowest levels seen in 2024.

Copper prices cool from one-month high, China outlook mixed

LME copper is headed for its first weekly drop in three, down half a percent so far this week.

Other industrial metals slipped due to mixed signals for the Chinese economy.

LME aluminum and zinc are down 1-4 per cent for the week.

Traders continued to book profits from rallying to multi-month highs earlier this week.

The recent rally in metals was driven chiefly by increased optimism over China, amid the rollout of more stimulus measures to support economic recovery.

However, data prints for January showed sustained economic weakness for China.

Official purchasing managers index data showed the manufacturing sector remained in contraction, while a private survey pointed to stagnating growth in the sector.

A deepening crisis in China’s property sector dented sentiment after beleaguered developer China Evergrande Group was ordered by courts to liquidate.

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