April 20, 2008	Sunday	Rabi-us-Sani 13, 1429

LONDON, April 19: Commodity prices struck new record highs this week, led by oil which surged above $116 for the first time, as investors favoured raw materials, including metals, over a tumbling US dollar.

The weak US unit stimulates demand for dollar-priced commodities because they become cheaper for foreign buyers holding stronger currencies.

OIL: Prices soared to record levels once more, drawing strength from the struggling dollar and sliding energy stockpiles in key consumer the United States.

Unrest in Nigeria, Africa’s biggest producer of crude, also lent support.

On Friday, the price of New York’s light sweet crude hit an all-time peak of $116.10 per barrel, while London’s Brent oil scored a lifetime pinnacle of $113.57.

Crude oil prices crossed 116 dollars a barrel for the first time after a pipeline attack in Nigeria.

The most prominent militant group in Nigeria’s southern oil-producing region said Friday it had sabotaged a major oil supply pipeline belonging to Anglo-Dutch oil group Shell.

The Movement for the Emancipation of the Niger Delta (MEND) said in a statement that it had carried out the sabotage operation late on Thursday in Rivers state.

Crude futures had meanwhile crossed $115 a barrel for the first time earlier in the weak as investors reacted to events in foreign exchange trading.

The weakening in the dollar against a basket of major currencies has created opportunities for investors to seek better returns in commodities, said analysts at energy consultancy John Hall Associates.

As such, further weakening of the greenback is likely to mean further increases in oil prices. It remains to be seen though when the dollar might break through the 1.60 dollar/euro mark, they added.

In the foreign exchange market, the European single currency had struck a record-high of $1.5984 on Thursday.

Oil prices also won strong support this week from a US government report which showed US energy stockpiles had plunged in the week ending April 11.

US gasoline or petrol inventories fell 5.5 million barrels last week, which was considerably more than market expectations for a fall of 1.8 million.

Traders focus on gasoline supplies ahead of the peak demand season for motor fuel that starts in May when Americans take to their cars for their summer holidays.

US crude oil inventories slumped 2.3 million barrels last week compared with the consensus forecast for a drop of 1.8 million.

By Friday, New York’s main oil futures contract, light sweet crude for delivery in May, surged to 115.77 dollars per barrel from 109.72 dollars a week earlier.

Brent North Sea crude for June jumped to 113.21 dollars per barrel from 108.20 dollars.

BASE METALS: Copper and tin prices scaled historic heights on Thursday, bolstered by the struggling dollar and strained supplies.

Many base metals ended the week lower, however, as investors banked profits.

On the London Metal Exchange (LME), copper for delivery in three months hit 8,880 dollars per ton, beating the previous high of 8,820 dollars that was set on March 6.

Overall the metal showing the most tightness is copper, said William Adams of BaseMetals.com.

We would expect the tightness in the market to lead to further gains (for copper prices), especially as supply disruptions in Chile may come from two sources, the weather and strikes on the back of higher wage demands. The price of tin for delivery in three months meanwhile reached $21,750 per ton Thursday, which was the highest reading since 1989 when it was re-introduced on the London market.

Tin had surged past 21,000 dollars for the first time on Wednesday.

By Friday, copper for delivery in three months eased to $8,610 per ton on the LME from $8,630 a week earlier.

Three-month aluminium prices slid to $3,060 per ton from $3,082.

Three-month nickel gained to $29,250 per ton from $29,000.

Three-month lead dropped to $2,810 per ton from $2,910.

Three-month zinc prices decreased to$ 2,315 per ton from $2,345.

Three-month tin gained to $20,750 per ton from $20,025.

PRECIOUS METALS: Gold prices began the week strongly, boosted by the weak dollar. But they ended lower on profit-taking.

Further weakness in the dollar is likely to prompt additional safe haven buying, and in turn add upward pressure to gold prices, said analysts at Barclays Capital.

Gold had struck an all-time peak of $1,032.70 an ounce on March 17, four days after the yellow metal breached 1,000 dollars for the first time.

On the London Bullion Market, gold dropped to $908.75 per ounce at Friday’s late fixing from $927.75 a week earlier.

Silver climbed to $18.18 per ounce from $17.95.

On the London Platinum and Palladium Market, platinum rose to $2,026 per ounce at the late fixing on Friday from $2,019 a week earlier.

Palladium decreased to $451 per ounce from $469.

COCOA: Cocoa prices extended gains this week.

The tight supplies and increased demand for the crop are likely to keep pushing up prices in the coming weeks, said the Public Ledger.

By Friday on LIFFE, London’s futures exchange, the price of cocoa for July delivery climbed to 1,454 pounds per ton from 1,412 pounds a week earlier.

COFFEE: Coffee prices picked up further.

With so many different speculative players — the markets seem to be more and more at the mercy of the punters, noted Sucden analyst Andrew Kerr.

By Friday on LIFFE, Robusta for July delivery jumped to $2,348 per ton from $2,300 the previous week.

On the NYBOT, Arabica for July delivery advanced to 141.30 US cents per pound from 132.40 cents.

SUGAR: Sugar prices gained on rocketing oil futures.

Prices are recovering in April, as stronger crude oil prices will likely strengthen ethanol demand in Brazil,said analysts at Goldman Sachs.

By Friday on LIFFE, the price per ton of white sugar for August delivery rose to 363 pounds from 354.90 pounds the previous week.

On NYBOT, the price of unrefined sugar for July delivery grew to 13.06 US cents per pound from 12.45 cents.

RUBBER: Rubber prices rose this week as production slowed.

Prices are still high as supplies remain tight on the back of the wintering season, said a dealer who requested anonymity.

—AFP