Optimism all around for commodities as they closed the week with good gains.
May West Texas Intermediate (WTI) crude, the US benchmark fell 33 cents to settle at $US63.13 a barrel Friday, while Brent crude for June delivery eased 17 cents to $US66.77 a barrel.
That left WTI oil up around 6.3% for the week and Brent 5.8% higher thanks to the International Energy Agency and OPEC raising their demand forecasts for the rest of 2021 and a larger than forecast fall in US oil stocks, especially on the East Coast.
US crude oil inventories fell by 5.9 million barrels, or 1.2%, to 492.4 million barrels, relative to the market expectation of a fall of 2.1 million barrels, according to the weekly update from the country’s Energy Information Administration (EIA).
China’s state oil and gas group, China National Petroleum Company said last week that China’s 2021 net crude oil imports are forecast to grow year-on-year by 3.4% to about 559 million tonnes.
The weaker dollar for most of last week also helped bolster oil prices (and gold).
Traders ignored another rise in the number of US oil rigs in the weekly survey from services group, Baker Hughes.
The US drilling rig count increased 7 units to reach 439 rigs working for the week ended April 16.
The count is down 90 units from the 529 rigs working this time a year ago. The number of rigs drilling on land was up 5 units week-over-week with a total of 426.
US oil-directed rigs accounted for all the rise to 344 units. This time a year ago, 438 units were drilling for oil. Rigs targeting gas increased by 1 to reach 94, 5 more than were drilling for gas at this time a year ago.
There was a fall of one in the number of rigs being used for other reasons (water drilling?)
In New York Comex gold for June delivery rose $US13.40 to $1,780.20 an ounce. Silver for May delivery rose 15 cents to $US26.11 an ounce and May copper fell 5 cents to $US4.1680 a pound.
That left gold up 1.9% for the week, silver was up 2.8% and copper gained almost 3%, despite that big fall on Friday (a surprise given the solid Chinese production and investment data as well as the upbeat GDP number).
Friday saw the price of 62% Fe iron ore fines delivered to northern China close at $US178.43 a tonne, up $US4.89 or 2.8% over the week.
The price of 58% Fe fines fell over the week to $US153.58 from $US154.57 the previous Friday.
And the price of 65% Fe fines from Brazil was unchanged on the day at a record $US211.10 a tonne. That was a rise of $US8 a tonne or around 4% for the week.
The stronger performance and record closes on Thursday and Friday for the 65% type fines reflected the continuing stronger demand for this type of ore because of pressures on the steel companies to cut pollution.
Despite the crackdown on pollution and the high prices for iron ore – especially the 65% fines product, Reuters said more than 10 Chinese steelmakers have upgraded earnings forecasts in the past week or so – that’s especially so for makers of flat steel products used in cars, whitegoods and roofing.