LONDON, Aep 1: Oil prices rebounded this week owing to falling US energy reserves and a recovery for global equities.

US stocks rose sharply on Friday as Federal Reserve chief Ben Bernanke said the US central bank would act to limit the adverse effects” of the mortgage crisis on the economy.

Meanwhile the White House unveiled plans to aid homeowners facing foreclosure.

Many commodity prices had slumped earlier in August on fears of a global economic slowdown linked to losses in the US subprime mortgage market — high-risk home loans to which many banks and investment funds are exposed.

OIL: Crude prices recovered, with New York crude climbing above $74 a barrel on Friday for the first time since early August.

Oil prices were well underpinned at the end of the week by a potential storm forming in the Atlantic which re-ignited fears that supply from Gulf of Mexico oil installations could be squeezed.

Meanwhile, a weekly US inventory report released earlier this week has also lent support to oil futures. The data showed that gasoline supplies remain well below average and that crude stocks fell by more than the market had expected.

The situation in gasoline looks particularly alarming, Barclays Capital analysts said on Friday.

Demand has remained relentlessly strong, whereas production and imports have failed to keep up with growth in demand in the absence of the necessary price signals. The Department of Energy said Wednesday that US gasoline, or petrol, inventories dived by 3.6 million barrels last week, sharper than the forecasted 2.5 million barrels.

In London, Brent North Sea crude for October delivery soared to 72.95 dollars a barrel on Friday, compared with 70.39 dollars a week earlier.

GRAINS AND SOYA: Wheat prices rocketed to an all-time closing high of 7.845 dollars a bushel on Thursday.

Demand remains very strong for US wheat, Allendale analyst Joe Victor said.

By Friday on the Chicago Board of Trade, the price of maize for December delivery fell to 3.41 dollars a bushel, from 3.58 dollars a week earlier.

Wheat for December delivery propelled to 7.84 dollars a bushel, from 7.42 dollars the previous week.

PRECIOUS METALS: Gold, silver, platinum and palladium prices all rose.

Given the weaker outlook for the dollar and the fact that gold is now entering a period of traditionally strong physical demand the outlook is now beginning to look far more bullish.

A falling US currency ramps up demand for dollar-denominated commodities, such as gold, as they become cheaper for buyers holding stronger currencies.

On the London Bullion Market, gold advanced to $672 an ounce at Friday’s late fixing, from $660.85 a week earlier.

Silver rose to $11.95 an ounce, from $11.70.

BASE METALS: Base metals prices strengthened as equity markets further shook off worries about a global credit crunch linked to a weak US subprime mortgage market.

On Friday, the price of copper for delivery in three months gained to $7,530 a ton on the London Metal Exchange, from $7,198 a week earlier.

Three-month aluminium prices rose to $2,560 a ton, from $2,521.75.

Three-month nickel prices climbed to $30,000 a ton, from $27,099.

Three-month lead prices advanced to $3,195 a ton, from $3,185.

Three-month zinc prices increased to$3,120 a ton, from $3,090.

Three-month tin prices leapt to $15,637 a ton, from $14,374.

COCOA: Cocoa prices rebounded after sinking to a six-month low the week before.

Buyers returned to the market amid reports of that the cocoa crop in leading producer Ivory Coast has been hit by the Black Pod fungal disease. Some analysts said the outbreak could cut the 2007/08 crop by as much as 20,000 tons.

COFFEE: Coffee prices fell heavily in New York amid the prospect of a large harvest in producer nation Vietnam.

“The conditions (in Vietnam) have been and are nearly ideal” for coffee output, said analysts at VM Group.

SUGAR: Sugar prices edged down in London and New York amid expectations of a supply surplus.

Global sugar output was predicted to outpace demand by a record 10.8 million tons in the crop year ending September 2008, the International Sugar Organization recently forecast.

By Friday on the LIFFE, the price per ton of white sugar for October delivery fell to 277.40 pounds, from 281 pounds a week earlier.

RUBBER: The price of rubber extended gains owing to heavy rain in Malaysia and Thailand that further tightened supply.

There has been non-stop rain in the north of Malaysia, said an official at a rubber producing firm.

WOOL: Wool prices were lower in major producer Australia as fewer overseas buyers entered the market and the issue of China’s wool quota remained unresolved.

This week saw an easing in the market after last week’s gains, the Australian Wool Industry Secretariat said.—-AFP