Dhaka, Bangladesh (BBN) – The week started with a fall in oil prices posting a loss for the week, as anticipation of downgrades by Standard & Poor’s of several Euro Zone countries opposed the supportive effect of anxiety about Nigerian strikes and Iranian threats to shipping.
Brent crude futures rose during mid week staying above $111 on expectations of steady demand growth after the world’s second-largest oil consumer, China, posted an economic expansion that beat forecasts, a weekly market update said.
The week ended with Brent crude oil futures dropping back as a weak demand outlook overshadowed hopes that the International Monetary Fund (IMF) would be able to raise more money to help resolve Europe’s debt crisis.
Oil futures and other riskier assets gained in early trade after reports said the IMF is proposing to increase its lending pool by up to $600 billion to lend to nations battling with the fallout from the Euro Zone debt crisis.
However, this was overshadowed by a report from the Paris-based International Energy Agency, which cut its 2012 demand growth forecast by 220,000 barrels per day (bpd) from its previous monthly report, to 1.1 million bpd.
The week started with a downgrade in gold prices after the US dollar (USD) surged against the Euro (EUR) and fears about an imminent credit downgrade of Euro Zone countries prompted bullion investors to take profits on the recent rally.
The metal fell along with U.S. equities and other commodities as ratings agency Standard & Poor’s was poised to lower ratings of several Euro Zone countries including France and Austria.
However, during midweek, gold prices gained momentum as lackluster economic data lifted investor hopes for monetary stimulus in China, according to the update.
The fact that a flurry of credit downgrades in Europe and ongoing debt fears have failed to further boost gold showed that bullion could be near its decade-long bull run.
Gold kept in pace with its upward trend in price on gains in the EUR and US equities and optimism that the IMF will raise additional funds to help combat Europe’s debt crisis.
Bullion was on a progressive track for the remaining week in decent trading volume after U.S. investment bank Goldman Sachs Group Inc’s (GS.N) earnings beat estimates and increased investor appetite for risk.
The week started with a fall in oil prices posting a loss for the week, as anticipation of downgrades by Standard & Poor’s of several Euro Zone countries opposed the supportive effect of anxiety about Nigerian strikes and Iranian threats to shipping.
Brent crude futures rose during mid week staying above $111 on expectations of steady demand growth after the world’s second-largest oil consumer, China, posted an economic expansion that beat forecasts.
The week ended with Brent crude oil futures dropping back as a weak demand outlook overshadowed hopes that the IMF would be able to raise more money to help resolve Europe’s debt crisis.
Oil futures and other riskier assets gained in early trade after reports said the IMF is proposing to increase its lending pool by up to $600 billion to lend to nations battling with the fallout from the Euro Zone debt crisis.
However, this was overshadowed by a report from the Paris-based International Energy Agency, which cut its 2012 demand growth forecast by 220,000 barrels per day (bpd) from its previous monthly report, to 1.1 million bpd.
BBN/SI/AD-20Jan12-9:23 pm (BST)
