Oil, gold prices plunge in commodities selldown
Gold rally ends as prices hit a five-year low; oil goes below $US50 a barrel.
Oil has dropped below $US50 a barrel in New York trading and gold has fallen to a five-year low as commodities respond to selling pressure.
Spot gold traded down 1.9% at $US1113.19 an ounce as the prospects of a rise in official US interest rates increased. Copper, silver and platinum also fell.
Gold futures prices plunged at the end of last week as stronger economic data boosted investors’ expectations the US Federal Reserve could raise interest rates as early as September.
August futures settled today on Wall Street at $US1106.80, a fall of $US25.10, or 2.2%. The price briefly went below $US1100 an ounce, the lowest since April 2010.
Crude oil prices for August delivery settled at $US50.15 a barrel, the lowest settlement since April 2, after slipping as low as $49.85 a barrel earlier in the session.
The more-actively traded September contract closed down 77USc, or 1.5%, to $US50.44.
Brent, the global benchmark, fell 45USc, or 0.8%, to $US56.65 a barrel on ICE Futures Europe.
The price drop reflects strong output from the US and other nations in an over-supplied market.
Although oil consumption has risen this year, many analysts say demand is insufficient to eat away at the global glut of crude.
The recent Iranian nuclear deal added to the prospect that more crude oil could be produced in the coming months.
The oil market is also sensitive to currency moves. A stronger US dollar makes oil more expensive for non-US buyers.
Nevil Gibson
Tue, 21 Jul 2015
Tue, 21 Jul 2015
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Oil, gold prices plunge in commodities selldown
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