Crude Declines; Gold Falls; Soybeans Gain: Commodities at Close

The Standard & Poor’s GSCI gauge of 24 commodities fell 0.6 percent to 639.35 at 6:33 p.m. Singapore time. The UBS Bloomberg CMCI index of 26 raw materials dropped 0.2 percent to 1,566.028.

CRUDE OIL

Oil declined the most in more than two weeks because of concern that U.S. lawmakers may fail to avert spending cuts and tax increases that threaten the economy of the world’s biggest crude consumer.

WTI for February delivery fell as much as $1.20 to $88.93 a barrel in electronic trading on the New York Mercantile Exchange, the biggest drop since Dec. 6, and was at $89.12 at 9:56 a.m. London time. Prices are up 2.8 percent this week. The volume for all West Texas Intermediate futures today was about 5 percent higher than the 100-day average.

Brent for February settlement on the London-based ICE Futures Europe exchange slid as much as 84 cents, or 0.8 percent, to $109.36 a barrel. The European benchmark crude was at a $20.35 premium to New York-traded WTI, from $20.07 yesterday. The volume traded for all Brent futures today was about 19 percent lower than the 100-day average.

OIL PRODUCTS

Asia gasoil’s premium to Dubai was at the highest level in more than three months. Naphtha’s crack to Brent crude rose, heading for the biggest weekly gain in three. Reliance Industries Ltd. plans to restart a crude unit at the older of its two refineries at Jamnagar, India, by tomorrow after a fire yesterday.

• Middle Distillates • Gasoil crack to Dubai crude rose 59 cents to $20.86/bbl, at 10:28 a.m. Singapore time, according to PVM Oil Associates • Crack at the highest level since Aug. 30, PVM data showed • Jan. gasoil swaps rose 35 cents to $126.20/bbl • Jet fuel regrade falls 20 cents to 10 cents/bbl

• Light Distillates • Japan naphtha’s crack to Brent rose $3.55 to $111.30/ton, according to Bloomberg data • Crack spread rises 25% this week, the biggest gain since Nov. 30 • Jan. naphtha swap fell $1.50 to $936.50/ton, PVM data showed • Gasoline reforming margin yesterday rose 18 cents to $13.76/bbl, Bloomberg data showed

• Fuel Oil • High-sulfur fuel oil’s discount to Dubai narrows 20 cents to $8.02/bbl, PVM data showed • Discount to crude increased 11% this week, most since Nov. 30 • HSFO swaps for Jan. fall 25 cents to $618/ton • Feb. swaps trade at $3.75/ton premium to Jan. swap • Viscosity spread unchanged at $10.25/ton

BASE METALS

Copper in London rebounded after the biggest fall in two months yesterday as investors deemed the decline as excessive amid better-than-expected U.S. data.

PRECIOUS METALS

Gold headed for the worst week in six months as the struggle by U.S. lawmakers to reach a budget deal strengthened the dollar, countering purchases by central banks and investors. Silver dropped to a four-month low.

Spot gold fell as much as 0.7 percent to $1,635.80 an ounce and was at $1,644.25 by 2:07 p.m. in Singapore. It declined to $1,635.70 yesterday, the lowest price since Aug. 22, after data showed the U.S. economy grew at a 3.1 percent annual rate last quarter, exceeding all projections in a Bloomberg survey. Bullion is 3.1 percent lower this week, the most since the period to June 22, set for a fourth weekly drop.

GRAINS, OILSEEDS, SOFT COMMODITIES

Soybeans rebounded from a one-month low on speculation that the 5.8 percent slump in the past four days will lure importers and investors betting global supplies may decline as dry weather returns to Brazil.

The contract for March delivery gained as much as 1.4 percent to $14.245 a bushel on the Chicago Board of Trade, and was at $14.2125 at 4:13 p.m. in Singapore. Futures fell to $13.9775 yesterday, the cheapest since Nov. 20, after China canceled U.S. purchases for the second time in three days.

Corn for March delivery advanced 0.6 percent to $7.005 a bushel, set for 4.1 percent loss this week, the biggest drop for the most-active contract since the period to Sept. 21. Corn, which surged to a record in August, gained 8.4 percent this year.

Wheat for March delivery rose 0.4 percent to $7.94 a bushel, poised for a 2.5 percent weekly loss. Futures, which advanced to the highest in almost four years in July, are up 22 percent this year.

Rubber booked a third weekly gain in Tokyo amid speculation that the yen will drop further as Japan’s central bank may agree to double an inflation target after the election of a new government.

Rubber for delivery in May rose 0.6 percent to end at 284.5 yen a kilogram ($3,389 a metric ton) on the Tokyo Commodity Exchange, extending this week’s rally to 2.9 percent. A weaker Japanese currency can raise the appeal of yen-based contracts.

Palm oil climbed to the highest level in more than two weeks after data signaled a recovery in the U.S. economy, boosting prospects for cooking oil demand.

The contract for March delivery climbed as much as 3.1 percent to 2,392 ringgit ($781) a metric ton on the Malaysia Derivatives Exchange, the highest price for the most-active contract since Dec. 3, and ended the morning session at 2,391 ringgit. Futures have gained 5.1 percent this week and are heading for a 25 percent drop this year.

To contact the reporter on this story: Christian Schmollinger in Singapore at christian.s@bloomberg.net

To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net

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