September 23, 2007	Sunday	Ramazan 10, 1428

LONDON, Sept 22: Crude oil prices surged to all-time highs this week, striking a record peak of $84.10 a barrel in New York owing to heightened concerns over tight supplies in the United States.

Brent crude reached an historic $79.94 in London.

Oil also won strong support from a weak dollar, which made the dollar-denominated commodity cheaper for buyers using stronger currencies.

Other commodities priced in dollars, such as gold and silver, also benefited from the slumping US currency this week.

The euro raced to an all-time high of $1.4120 on Friday as the US currency came under heavy selling pressure on expectations of further interest rate cuts in the United States, dealers said.

The US Federal Reserve on Tuesday cut its key interest rate by a bigger-than-expected 50 basis points to 4.75 per cent.

OIL: Crude futures enjoyed a record-breaking week as traders seized on supply worries ahead of the latest northern hemisphere winter that begins at the end of 2007.

Prices were driven higher on fears a storm could threaten energy facilities in the US Gulf Coast. Traders are worried that stormy weather in the US Gulf of Mexico, which accounts for about one quarter of American oil output, could stretch tight global supplies ahead of peak US winter demand for heating fuel.

Prices are setting fresh records owing to the evacuation of oil rigs and platforms in the US Gulf of Mexico, said Barclays Capital analyst Kevin Norrish.

He added: The concern is that what is currently only a tropical disturbance in the eastern gulf could develop into a tropical storm and companies have already started evacuating workers from the area.

Both Shell and BP have reported that they are evacuating and shutting in all of their gulf oil production. The US Department of Energy had said Wednesday that American crude inventories plunged by 3.8 million barrels in the week ending September 14, underscoring global supply tightness.

That marked the 10th consecutive weekly drop and was almost double analysts’ consensus forecasts for a fall of about 2.0 million barrels.

By Friday, New York’s main oil futures contract, light sweet crude for delivery in November, soared to $81.74 a barrel, from $79.59 for the October contract a week earlier. The October contract expired Thursday.

In London, Brent North Sea crude for November delivery rocketed to $79.17 a barrel on Friday, from $76.70 a week earlier.

PRECIOUS METALS: Gold struck its highest price for 27 years as it surged to $738.60 an ounce on Thursday.The precious metal complex made strong gains, as greenback weakness and new record highs on oil gave the complex something to cheer about, BNP Paribas analyst David Thurtell said.

Gold is also benefiting from record high oil prices, which have raised fears of inflation. Gold is seen as a store of value and a hedge against higher prices.

Metals’ short-term fortunes may depend on the short-term fortunes of the dollar, which is weak against everything, UBS analyst John Reade noted.

On the London Bullion Market, gold gained to $737 an ounce at Friday’s late fixing, from $716.35 a week earlier.

Silver jumped to $13.47 an ounce at Friday’s late fixing, from $12.50 a week earlier.

On the London Platinum and Palladium Market, platinum rose to $1,332 an ounce at the late fixing Friday, from $1,294 a week earlier.

Palladium climbed to $340 an ounce, from $330.

BASE METALS: Base metal prices mostly rallied, owing to the weak dollar.

There is a good chance base metals will firm further as demand picks up into the seasonally strong fourth quarter, said BaseMetals.com analyst William Adams.

On Friday, the price of copper for delivery in three months jumped to $8,009.50 a ton on the London Metal Exchange, from $7,550 a week earlier.

Three-month aluminium prices dipped to $2,437 a ton, from $2,440.

Three-month nickel prices soared to $32,799 a ton, from $28,598.

Three-month lead prices advanced to $3,347 a ton, from $3,209.85.

Three-month zinc prices increased to $2,905 a ton, from $2,849.

Three-month tin prices rose to $15,375 a ton, from $14,875.

COCOA: Cocoa prices jumped owing to concerns over tight supplies in leading producer Ivory Coast.

Speculators were again active in the markets on concerns about output from West Africa, Sucden analysts said.

By Friday on the LIFFE, London’s futures exchange, the price of cocoa for December delivery rose to 990 pounds a ton, from 967 pounds a week earlier.

On the New York Board of Trade (NYBOT), the December contract climbed to $1,983 a ton, from $1,840 the previous Friday.

COFFEE: Coffee prices struck nine-month highs in London before sliding on profit-taking.

On Monday, Robusta quality coffee reached $2,026 a ton -- the highest level since 1998 as speculators dived into the market amid supply worries in Brazil.

There is a perception that it might be continually dry (in Brazil), said Ian Smaldon, an analyst at Mercon Coffee Corporation. We need rain in order for flowering to take place. By Friday on the LIFFE, Robusta quality for November delivery fell to $1,874 a ton, from $1,940 one week earlier.

On the NYBOT, Arabica for December delivery increased to 131.60 US cents a pound, from 119.90 cents.

SUGAR: Sugar prices rebounded as the weak dollar offset expectations of large supplies.

By Friday on the LIFFE, the price per ton of white sugar for December delivery climbed to 281 pounds, from 269.10 pounds a week earlier.

On the NYBOT, the price of unrefined sugar for October delivery increased to 9.85 US cents a pound, from 9.29 cents a week earlier.

GRAINS AND SOYA: The prices of grains and soya advanced in Chicago as the dollar slid and also because of supply concerns.

Analysts this week said that Australia’s long-running drought is expected to slash wheat production in the coming year by a third, lowering export levels and increasing price pressures.

By Friday on the Chicago Board of Trade, the price of maize for December delivery rose to $3.71 a bushel, from $3.49 a week earlier.

Wheat for December delivery climbed to $8.56 a bushel, from $8.39 the previous week.

November-dated soyabean meal -- used in animal feed -- advanced to $9.81, from $9.47.

On the LIFFE, the price per ton of wheat for November delivery fell to 172.50 pounds, from 179.00 pounds a week earlier, when the May contract was the most traded.

RUBBER: The price of rubber rose for the seventh week in a row owing to lower production because of adverse weather conditions and the surge in global oil prices, which is used in the production of synthetic rubber.

When oil prices are up, the price of synthetic rubber will be higher and that has an impact on natural rubber prices, Intracom trader Robert Chai said.

By Friday, the Malaysian Rubber Board’s benchmark SMR20 rose to 216.60 US cents per kilo, from 211.85 the previous week.

WOOL: Prices finished higher in major producer Australia, with buyers for China, Italy and the rest of Europe showing a strong presence at sales around the country.

It was another good market this week, with a 17 (Australian) cent lift in the Eastern Index, despite the 2.4 per cent increase in the United States exchange rate, the Australian Wool Industry Secretariat said.

The Australian wool market finished the week 1.9 per cent higher on average, with the Eastern Index adding 17 Australian cents to close at 9.33 Australian dollars a kilo.---AFP