Commodity prices recover: Dept

THE Treasury Department says prices of key export commodities, especially oil, have recovered noticeably but remained low as expected over the first half of this year.
In its mid-year economic fiscal outlook report released this week, the department said gold prices rose sharply over the same period boosted by appeal for safe-haven investment.
“Oil prices recovered noticeably rallying over five consecutive months from a low of US$26 per barrel at the turn of the year,” the report said.
It said the oil price recovery reflected a number of factors including possible production freeze among countries of the Organisation of Petroleum Exporting Countries and non-OPEC countries, unplanned supply disruptions in Iraq, Nigeria, Canada, and the United Arab Emirates, and seasonal oil demand.
“The lower US oil production towards the end of 2015 and the declining projected output over the short-term is also a key factor to the oil price recovery,” it said.
However, oil price remained under-pressure due to strong supply condition amid a weakening global demand.
In the first half of the year, the crude oil price averaged at US$40 per barrel.
“Persistent overcapacity in the copper market amid softening global growth prospects (notably in the Chinese economy) weighed on copper prices. In the first half of the year, copper prices averaged at US$4,703 per tonne.”
It said Gold prices continued to be influenced by global developments associated with the US economy.