July 15, 2007	Sunday	Jamadi-us-Sani 29, 1428

LONDON, July 14: World oil prices surged this week as speculators rushed into the market amid tight American fuel supplies, driving London's Brent crude within grasp of a new record high.

Many commodities won support from the falling US currency, which increase demand for dollar-denominated commodities, such as gold and crude oil, as they become less expensive for buyers holding other currencies.

The euro shot up over $1.38 here Friday for the first time since its creation in 1999, touching $1.3814 as weaker-than-expected retail sales in the United States compounded concerns about the country's economy.

OIL: The price of Brent North Sea crude for August delivery leapt to $77.68 the highest point since August 10, 2006.

That was less than a dollar below the record high of $78.64 set on August 7 last year.

And New York's main oil futures contract, light sweet crude for delivery in August, hit $74.00, last seen on August 11, 2006, but some way off the record high of $78.40 set the previous month.

Oil prices saw strong gains in the past two weeks, with fresh fund and speculative money flowing into the market, amid strong demand in the US during the summer driving season, as (US) gasoline stockpiles remained below usual levels for this time of the year, said Sucden analyst Andrey Kryuchenkov.

Geopolitical concerns, including continuous troubles in Nigeria, and various refinery outrages helped to push the market higher.Prices were also lifted by news that the International Energy Agency has lifted its 2008 forecast for oil product demand by 2.5 per cent to 88.2 million barrels a day.

However, the IEA predicted in a monthly report that tightness on the global oil market would ease next year, forecasting that supplies will exceed robust demand.

The IEA suggested again that the Opec producers' grouping should pump more crude, notably during the ongoing US summer driving season when many Americans take to their cars for their holidays.

Earlier this week Abdullah al-Badri, secretary general of the Organisation of Petroleum Exporting Countries, said Opec did not plan to raise its oil output to ease the pressure on crude prices.

Meanwhile, US government data showed that gasoline or petrol reserves climbed by 1.2 million barrels in the week ending July 6. That beat analysts' forecasts of a gain of 825,000 barrels.

But American gasoline stocks remain 3.8 per cent lower than at the same stage last year.

The market was meanwhile underpinned by further unrest in Nigeria, the world's eighth biggest crude exporter and the largest in Africa.

GOLD: The price of gold advanced as the precious metals complex was lifted by the diving US dollar and soaring oil prices.

The combination of weak dollar and oil driven inflationary concerns will continue to work in gold's favour, said James Moore, an analyst with specialist metals website TheBullionDesk.com.

Gold benefits from higher crude prices, which increase the risk of inflation. That increases the attractiveness of the precious metal as a defence against the erosion of the value of money.

On the London Bullion Market, gold jumped to $666.50 an ounce at Friday's late fixing, from $648.75 a week earlier.

SILVER: Silver prices vaulted higher in line with other precious metals, hitting a three-week high of $13.16.

On the London Bullion Market, silver increased to $13.13 n ounce at Friday's late fixing, from $12.40 a week earlier.

PALLADIUM AND PLATINUM: The sister metals both rose as the weak US currency weakened, and a strike loomed in key producer South Africa.

On the London Platinum and Palladium Market, platinum jumped to $1,313 an ounce at the late fixing Friday, from $1,287 a week earlier.

Palladium stood at $368 an ounce, from $363.

BASE METALS: Lead prices hit another record high, rising in line with most base metals, but nickel and copper prices pulled back following recent strong gains.

Lead hit surged as high as $3,040 a ton, lifted by keen Chinese demand.

Supply disruptions and delays, low stocks and strong consumption have all been features of the base metals markets during the first six months of 2007,said Barclays Capital analysts.

They added: Domestic Chinese (lead) prices are rising on a daily basis and are now trading in excess of $3,100 per ton, reflecting chronic supply shortages in the country. Elsewhere in the base metals sector, Anglo-Australian miner Rio Tinto launched a blockbuster bid to buy Alcan for $38.1 billion (27.6 billion euros) to create the world's biggest aluminium company.

The takeover will not only allow them to become the world's largest aluminium producer, but also the world's top supplier of alumina and bauxite needed to make it, said Sucden analyst Michael Davies.

Hence, it puts them in a great position to serve the Chinese market which has the fastest growing consumption rate for aluminium in the world. On Friday, the price of copper for delivery in three months eased to $7,780 a ton on the London Metal Exchange, from $7,816 a week earlier.

Three-month aluminium prices rose to $2,798 a ton, from $2,791.

Three-month nickel prices fell to $32,700 a ton, from $35,510.

Three-month lead prices rocketed to $3,000 a ton, from $2,645.

Three-month zinc prices jumped to$ 3,550 a ton, from $3,385.50.

Three-month tin prices advanced to $14,175 a ton, from $14,115.

COCOA: Cocoa prices fell away from recent peaks hit the previous week amid unrest in key producer Ivory Coast.

London cocoa futures finished lower, coming off from recent four-and-a-half year highs, under pressure from news of rainfall in Ivory Coast, Davies said.

He added: The market was pausing after a strong performance last week, which was triggered by a June 29th assassination attempt on the prime minister of Ivory Coast. By Friday on the LIFFE, London's futures exchange, the price of cocoa for September delivery retreated to 1,102 pounds a ton, from 1,138 pounds a week earlier.

On the New York Board of Trade (NYBOT), the September contract slid to $2,075 a ton, from to$ 2,123 the previous Friday.

COFFEE: Coffee prices were mixed, but fell in London on profit-taking after rising close to a nine-year high.

London coffee prices had surged to nine-year highs a fortnight ago amid market worries over lower exports from Vietnam, which is the world's second-biggest coffee producer after Brazil.

By Friday on the LIFFE, Robusta quality for September delivery dipped to $1,805 a ton, from $1,890 a ton one week earlier.

On the NYBOT, Arabica for September delivery firmed to 109.85 US cents a pound, from 109.70 cents.

GRAINS AND SOYA: Maize, wheat and soya prices rose across the board in Chicago.

The primary focus, which will remain for at least the next two weeks for corn, will be all weather related: making sure that the heat doesn't get the best of the crop, said Allendale analyst Joe Victor.

By Friday on the Chicago Board of Trade, the price of maize for September delivery climbed to $3.477 a bushel, from$3.415 a week earlier.

Wheat for September delivery rose to $6.20 a bushel, from $6.10.

August-dated soyabean meal -- used in animal feed -- increased to $9.09, from$8.69.

On the LIFFE, the price per ton of wheat for November delivery rose to 118.85 pounds, from 117.50 pounds.

SUGAR: Sugar prices were mixed amid the prospect of a global production surplus this year.

By Friday on the LIFFE, the price a ton of white sugar for August delivery slid to $309.40, from $320.50 a week earlier.

On the NYBOT, the price of unrefined sugar for October delivery firmed to 9.99 US cents a pound, from 9.17 cents for the July contract.

RUBBER: The price of rubber fell slightly as favourable weather conditions increased supplies in key producing nations.

Rubber prices are on the downtrend due to improved weather which brings in more crops and improves supply, said an official with a rubber producing firm.

On Friday, the Malaysian Rubber Board's benchmark SMR20 was fell slightly to 200.45 US cents per kilogram, compared with 200.65 US cents last week.—AFP