Yesterday, crude oil prices fell very sharply by the largest scale in over two years. Gold and silver prices continued their descent as well. There are several factors that might have contributed to this financial market shock and it’s probably related to the strengthening of the US currency compared to major currencies including the EURO.
Here is a summary of the changes in commodities and precious metals for May 5th:
One of the main changes yesterday came from the major currencies: the EURO/ USD decreased very sharply by 1.94%, as the USD appreciates against the EURO. This might be related to the no-change decision of the ECB in regards to the EURO zone interest rate.
Oil and Gas prices:
Spot oil price (WTI) declined for the fourth straight day, yesterday by 8.64% – the sharpest fall since April 2nd 2009 as it reached 99.80$/b – making it below the 100$ mark for the first time since March 3rd 2011; during May the WTI spot oil price fell by 12%.
Brent spot price also fell by 8.33% and reached 110.58$/b.
As a result, the difference between Brent and WTI declined to 10.78$/b.
Natural gas prices (Henry Hub spot) also declined very rapidly yesterday by 1.74% and reached 4.51$/mmbtu.
The Henry Hub future price decreased by a larger scale and decreased by 6.99% to 4.26$/mmbtu, as a result the spread between future and spot price declined to -0.25$, i.e. backwardation.
Precious Metals prices:
Silver price continued its freefall for the fourth straight day, yesterday by 7.99% to 36.3924 – this is the lowest price level since March 22nd 2011; gold price, also declined by 2.24% and reached 1,481$.
During May, gold prices decreased by 4.8% and silver price fell by 25.4%.
A summary of yesterday’s Prices Changes:
The table below includes: closing prices, daily percent change, and change in US dollars (except for USD/CAD, in which the change is in Canadian dollars):
For further reading (in this site):
- Gold drops from 1500$ mark – Gold & Silver Prices Outlook, 5 May
- Oil prices continued to fall what’s next? – oil outlook 5 May
- Weekly outlook for May 2-6
Monthly Analysis and Outlook:
- Natural gas prices outlook for May 2011
- Gold and silver prices outlook May 2011 – what’s next for gold & silver?
- Crude oil prices Monthly outlook –April 2011