Commodity Capsule: Brent crude oil to gain for third consecutive week; metal rise; gold slips

Commodity Capsule: Crude Oil is headed for a third straight week of gains, bolstered by supply constraints from leading oil producers Saudi Arabia and Russia.

WTI crude oil benchmark has demonstrated a consistent upward trend, crossing the $90/barrel mark on Thursday, a high not observed since November of the previous year.

Earlier this week, both the International Energy Agency and Organisation of Petroleum Exporting Countries expressed concerns over a potential market deficit that could continue until the end of the year.

Crude is registering a 5 per cent rise since last Friday's close.

The tightening of the oil market can be attributed largely to supply cuts implemented by Saudi Arabia and Russia.

BofA and ANZ expect Brent crude prices to hurtle higher to the $100 mark before the end of this year.

Industrial Metals Climb after China data, Firm dollar caps upside

Copper prices were firm on Friday, on track for weekly gains, as China boosted its policy support for its sputtering economic recovery, with the metal holding on to gains following a slew of Chinese indicators.

China's Industrial output grew 4.5 per cent in August from a year earlier, accelerating from the 3.7 per cent pace seen in July. It was the fastest pace in industrial production since April.

China's retail sales increased by 4.6 per cent year-on-year in August 2023. This was the eighth straight month of rise in retail trade and the strongest pace since May.

China's central bank said on Thursday it would cut the amount of cash that banks must hold as reserves for the second time this year to boost liquidity.

Gold set for 2nd weekly drop on higher–for–longer rate jitters

Gold prices were on track for their second straight weekly decline on Friday as U.S. inflation readings for August reinforced market bets for further rate hikes by the Federal Reserve after a likely rate pause next week.

Gold was steady past at $1,900/ounce. Bullion was on track for a weekly decline of 1 per cent after having touched its lowest level since August 23 on Thursday.

U.S. producer prices increased by the most in more than a year in August while retail sales also beat expectations, boosted by a surge in gasoline prices. This comes after US consumer prices increased by the most in 14 months last month.

European Central Bank raised its key interest rate to a record high of 4 per cent on Thursday but signaled that the hike was likely to be its last.

Malaysian palm oil futures rose for a third straight session on Friday, underpinned by strength in rival vegetable oils, but the market was set to post a second weekly drop.

Benchmark palm oil contract has lost nearly 1 per cent so far this week.

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