Commodities: Oil futures continue to inch higher

Oil futures continued to inch higher on Thursday, amid conflicting market chatter of possible production cuts, while precious metals saw lacklustre trading following the US Federal Reserve’s decision to maintain status quo.

At 1645 GMT, Brent front-month oil futures contract was up 2.54% or 84 cents to $33.94 per barrel, while WTI rose 2.54% or 82 cents to $33.12 per barrel. Earlier Interfax reported Russian energy minister Alexander Novak had said that Saudi Arabia had been suggesting output cuts of 5% at previous OPEC meetings, with the size of the reductions currently under discussion.

However, Bloomberg reported that four delegates to OPEC had told the newswire they had not heard yet of any plans for talks.

Elsewhere, headline base metal futures were largely in negative territory on the London Metal Exchange. During late afternoon trading, three-month futures contracts of copper (down 0.9%), lead (down 0.5%), nickel (down 1.1%), tin (down 1.9%) and zinc (down 1.5%) headed lower.

Liz Grant, senior account executive at Sucden Financial, said, “Both US and European equity markets were lower on disappointing corporate results. On the data front – US initial weekly jobless claims were down 16k and durable goods orders for Dec fell sharply, down 5.1%. So we saw a general pull back in LME prices as momentum eased after the last two days of price gains.”

Precious metals also slipped into negative territory as the US Federal Reserve kept the range for the Fed funds rate unchanged at between 0.25% and 0.50% at the conclusion of its meeting on Wednesday.

It also noted it was "loosely monitoring global economic and financial developments and is assessing their implications for the labor market and inflation, and for the balance of risks to the outlook."

On the COMEX, the front-month gold futures contract was broadly flat $1,115.80 an ounce, while spot gold was 0.90% or $10.15 lower at $1,114.82 an ounce. COMEX silver fell 1.58% or 23 cents to $14.23 an ounce, and spot platinum was down by 1.88% or $16.57 to $865.38 an ounce.

Finally, agricultural commodity futures were largely in negative territory. CBOT corn (down 0.95%), CBOT wheat (down 1.05%), and CME live cattle (down 0.55%) headed lower, but ICE cocoa (rose 1.48%) bucking the trend in early trading calls stateside.