Commodities: US oil storage capacity use hits record

Commodity prices slipped despite weakness in the US dollar, led by losses in the energy complex.

Front month West Texas Intermediate crude oil futures were retreating 1.05% to $48.85 per barrel as of 21:14 BST in NYMEX trading.

That was despite the release of the latest weekly inventory data from the US Department of Energy which revealed a 0.9m barrel draw-down in commercial oil stockpiles despite a hefty increase in imports.

Worth noting, the DoE also published its twice-yearly estimate on the degree of use of the country's oil storage capacity, saying it had reached a record 73% over the week ending on 10 June, as inventories increased by 71m barrels since the end of September and capacity rose by 34m.

In parallel, RBOB gasoline futures on NYMEX fell by 0.63% to $1.5828 per gallon, while natural gas futures tumbled 3.47% into the close to end the day at $2.67/MMBtu.

Ahead of the Brexit referendum, August 2016 COMEX gold futures gave back 0.32% to close at $1,268.40/oz.

Steel prices gained ground in overnight trading, among signs of steady steel output globally and stockpiles in Chinese markets.

Global production of steel declined by 0.1% year-on-year in May, according to worldsteel data released on Tuesday and referenced by analysts at Macquarie.

However, while that marked the 17th consecutive month of contraction it also pointed to a “decent recovery” from January’s 6.7% drop in production, the Australian broker explained.

The most active rebar futures, for October delivery, on Shanghai’s Futures Exchange rose by 2.8% to 2,143 yuan ($325.27) a tonne by the close of trading on Wednesday – its highest since 14 June – according to Reuters.

Three-month copper futures on the LME finished the day up by 1.7% at $4,716.00 per metric tonne.

To take note of perhaps for commodity prices, in its latest so-called Article IV consultation with the US the International Monetary Fund posited that the Greenback might be overvalued by between 10.0% to 20.0%.

September 2016 corn futures on the Chicago Board of Trade lost 0.99% to $3.9825 pr bushel.

Bloomberg's commodity index fell 0.64% to 177.62 even as US dollar spot index slipped 0.30% to 93.73.