Commodity Week Roundup

Energy

Crude oil rose for the 8th week in a row and is getting close to Wall Street’s announced target of $90 by year-end. Demand for crude oil continues to rise due to the recovery from the COVID 19 pandemic, but supply remains tight. After OPEC+ turned down the U.S. government on the issue of increasing production, the only question that remains is how much further oil prices will rise.

Demand could increase further now that the White House has announced it will allow international travelers to enter the country if they are fully vaccinated.

WTI crude oil rose 1.2% to $82.28 a barrel. This is the highest level in 7 years.

Brent crude oil rose 1% to $84.86 a barrel. This is the highest level since October 2018.

Natural gas and thermal coal remain at highs, even the announcement by the Chinese government to increase coal production will not change this. Natural gas is at its highest level in 12 years and currently stands at $5.42 per MMBtu. Thermal coal stands at $240 per ton.
The global energy crisis, which is hitting countries that have pinned their hopes on wind and solar power, remains a hot topic.

The countries that rely on nuclear power do far better. Nuclear power is and remains the only clean and reliable source of energy. Japan and France have announced their intention to continue investing in nuclear power. France wants to develop small modular reactors with a state-owned company. In the sprint to Net Zero, the Japanese have also set their sights on nuclear power again. Japan’s new prime minister has already said that Japan should replace old nuclear power plants with smaller modular reactors. Japan is about to restart its nuclear fleet since the phase-out after the Fukushima disaster in 2011.

The price of uranium is currently $40.20 per pound.

The shares of uranium producers were able to gain again this week as investors continued to back uranium shares. The uranium ETFs, The NorthShore Global Uranium Mining ETF (ticker: URNM), and Global X Uranium ETF (ticker: URA) also gained 19.30% and 16.56% this week. Investors have already poured more than $1 billion into the ETFs this year.

Precious Metals

The gold price was able to close this week with a plus of 0.6% and currently stands at $1,768.20 per ounce.

Silver was also able to close this week with a plus of 2.91% and stands at $23.35 per ounce.

Platinum rose this week by 3% to $1,060 per ounce.

Palladium fell 0.19% to $2,076.50 per ounce.

On Wednesday, the gold price still jumped to the $1800 mark, before it reduced again at the end of the week. The inflation issue and supply chain bottlenecks remain. Various shots show meanwhile empty shelves in supermarkets and rising prices of gasoline and beef.

Also, the rebound of the U.S. 10-year Treasury note towards the end of the week let the gold price fall for the time being.

Gold, therefore, remains on hold but still at a high level. Long-term gold investors should not be discouraged by the current consolidation. The wind is still favorable for the yellow precious metal because the fundamentals are still intact.

Base Metals

The energy crisis has meanwhile also pushed the already high industrial metal prices even higher. Due to the energy shortage, many countries, such as China, experienced power outages. This has led to the production of industrial metals were suspended and led to tightness in the market.

The zinc price has increased this week by 13.3% to $3,795.00 per ton.

Aluminum prices have increased again by 5.6% to $3,164.50 per ton.

Copper prices have gained 6.2% to $10,552.50 per ton.

Iron ore gained 0.3% this week to $122.83 per ton.

Nickel prices gained 2.24% to $19,859.00 per ton.

Lead price gained 3.3% to $2,402.00 per ton.

Tin price increased 2.64% to $38,925.00 per ton.

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