Weekly Fundamentals - OPEC Sidelined Despite Oil Rallies

9 April 2011 9 April 2011

BonTrade

Commodities were broadly higher last week as driven by weaker US dollar. Strength in oil prices was led by Brent crude which broke above $120/bbl and reached as high as $126.91/bbl before settling at $126.65/bbl, up +6.70% on weekly basis. On top of geopolitical tensions in the MENA region, fears of oil supply were exacerbated by the delayed elections in Nigeria and strike in Gabon. Natural gas slumped in both the US and Europe as mild weathers reduced demand. In the precious metal complex, gold rallied to a new record high of $1476.4/oz on Friday as renewed sovereign concerns in the European periphery, debt problems in the US, heightened inflationary pressures and uncertainty in Japan overshadowed the effect of ECB's rate hike.