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AAP

2012-12-14

A summary of trading in key commodities markets overseas:

ENERGY

Oil prices eased as the market fretted about the US fiscal cliff crisis that threatens to throw the world's biggest crude oil consumer back into recession.

New York's main contract, West Texas Intermediate (WTI) for January delivery, shed 88 cents from Wednesday to settle at $US85.89 a barrel.

In London trade, Brent North Sea crude for January dropped $US1.59 to close at $US107.91.

With just 18 days left before the January 1 kick-off of drastic US tax increases and spending cuts known as the fiscal cliff, President Barack Obama and Republican lawmakers remained at odds over a compromise to avoid the cliff.

BASE METALS

Base metals on the London Metal Exchange closed mostly lower as a stronger dollar and persistent concerns regarding the US fiscal cliff failed to buoy prices.

At the close of open-outcry trading, flagship base metal LME three-month copper closed 0.7% lower at $US8,074 a metric ton.

LME metals had slipped overnight and sustained losses into European trading, even though the US Federal Reserve announced further accommodative monetary-stimulus measures aimed at boosting the world's largest economy in the Federal Open Market Committee's final policy statement of the year Wednesday.

A weaker euro versus the US dollar weighed on the complex, analysts said.

PRECIOUS METALS

Investors are selling gold as the end of the year draws closer without a compromise in hand for the US budget.

Gold for February delivery dropped $US21.10 to finish at $1,696.80 per ounce.

Investors are uncertain about what's ahead if Republicans and President Barack Obama fail to agree on a new budget.

Without an agreement, tax increases and spending cuts will take place on January 1 that many economists believe could send the US into a recession.

The Federal Reserve has announced measures to support the economy but predicts growth will be no more than 3.0 per cent in 2013.