• Print
• E-Mail

Energy

Crude oil closed modestly lower today, with the October contract settling 36 cents lower at $109.35 a barrel. News that the U.S. Energy Department will release oil from its emergency reserves due to storm related disruptions sent oil lower on the session.

On Wednesday, about 96-percent of oil production in the Gulf of Mexico, and about 92-percent of natural gas output remained shutdown, according to the U.S. Minerals Management Service. The Gulf of Mexico accounts for 25-percent of U.S. oil production and 40-percent of refining capacity.

Royal Dutch Shell, and other energy companies were still assessing offshore energy installations Wednesday, with no reports of major damage following Gustav. "Our goal is to restart all shut in systems safely and as quickly as possible," Shell said in a statement.

The EIA will release its weekly data on natural-gas supplies at 10:30 a.m. EDT Thursday, Analysts expect the EIA to report an increase of 90 to 100 billion cubic feet of natural-gas supplies for the week ended Aug. 29. The EIA will release its report on petroleum supplies at 11 a.m. with analyst expecting a decline of approximately 2 million barrels.

October natural gas settled nearly unchanged at $7.264 per million British thermal units, October RBOB gasoline settled 3.3 cents higher at $2.7668 a gallon, and October heating oil settled 0.5 cent higher at $3.0788 a gallon.

Metals

Gold fell to a 2-week low today, with the December contract settling $2.30 lower at $808.20 an ounce. Strength in the U.S. dollar, and falling energy prices reduces the appeal of precious metals as a hedge against inflation. The euro fell nearly 1-percent versus the dollar after reports showed the economy in the 15 nations is slowing.

Hedge funds and other large speculators reduced their net long gold futures position by 6-percent in the week ended Aug. 26, as shown by U.S. Commodity Futures Trading Commission data. Speculative long positions still outnumbered short positions by 105,279 contracts.

Palladium closed 1.6-pecent lower today, with the December contract settling $4.65 lower at $288.40 an ounce. Collapsing auto sales have helped contribute to a decline of over 50-percent in the price of palladium, which is used in catalytic converters, over the past 6-months.