Commodities: Oil gets a boost as Qatar affirms adherence to Opec output cuts

Crude-oil prices got a boost higher after Qatar affirmed it would continue with its share of Opec oil production cuts.

It follows falls in both grades of crude a week or so ago after Saudi Arabia, Bahrain, Egypt and United Arab Emirates severed diplomatic ties with Qatar.

At 15:32 BST, Nymex-priced West Texas Intermediate crude was up 1.7% to $46.61 a barrel. Intercontinental Exchange-traded Brent rose 1.64% to $48.94 a barrel.

"Oil bounced on Monday after Qatari Energy Min Mohammed al-Sada vowed Qatar would continue with its share of Opec oil production cuts," said London Capital Group's Jasper Lawler.

"There's already a concern Opec hasn't done enough to offset US shale production without Qatar quitting the deal," said senior-market-analyst Lawler added.

"The future of Qatar’s role in the output cuts had been thrown into jeopardy when it was politically chastised by other countries in the region."

SwissQuote said it considered that further weakness was very likely in crude prices.

By contrast, FXTM vice president of market research Jameel Ahmad said, after the Opec meet, WTI had found support at $45 and was expected to attempt a recovery from here.

"There is still a risk that US inventories/shale production will offset the efforts from Opec non-members when it comes to trimming the oversupply in the markets," said Ahmad.

"However, oil looks oversold at $45 to my eye until we can see clear signs that there is increased inventories from the US."

Meanwhile, also at 15:32 BST, on Comex, gold fell 0.28% to $1267.8 an ounce. Silver fell 1.21% to $17.02 an ounce. Copper was down 0.57% to 263.45 cents a pound.

SwissQuote observed that the safe-haven yellow metal was consolidating within uptrend channel.

"Hourly support is located at $1246. Stronger support is given at $1195. Expected to show renewed upside pressures," said SwissQuote in a note.

"In the long-term, the technical structure suggests that there is a growing upside momentum."

On LME, three-month industrial metals were mostly higher. Zinc rose 2.68%, copper added 1.3% and aluminum firmed 0.24%. Tin, however, fell 1.98%.