SubscribeDaily Futures Commentary COMMODITIES 030909
Monday, March 9, 2009
ENERGIES
The energy complex is trading mixed this morning because of weakness in the equity markets. Bearish traders are still holding on to hope that the recession will worsen and demand for crude oil will decline further. Bullish traders are beginning to take control of the markets in anticipation of another production cut by OPEC at its next meeting on March 15.
Seasonality is also another reason to look at the long side of crude oil. The start of the U.S. driving season is expected to increase demand for unleaded gasoline and crude oil.
News that OPEC may cut production again is already getting the support of Russia, Iran and Venezuela. Traders fear that OPEC will try to cut 800,000 to 1,000,000 barrels per day. Given the current 80% compliance with previous cuts, crude oil could rally to $50 over the near-term.
METALS
April Gold and May Silver are trading weaker overnight. It looks as if speculators are not buying precious metals despite the weakness in global equity markets. News that interest rates …
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