Commodity Research Report Ways2Capital 9 January 2017

Spot gold XAU= was steady at $1,173.06 an ounce by 0047 GMT. The metal rose nearly two percent last week, its biggest weekly percentage rise since early November

Spot gold XAU= was steady at $1,173.06 an ounce by 0047 GMT. The metal rose nearly two percent last week, its biggest weekly percentage rise since early November.
U.S. gold futures GCcv1 were unchanged at $1,173.80 per ounce.
The dollar index .DXY , which measures the greenback against a basket of currencies, edged 0.1 percent higher at 102.27.
U.S. employment increased less than expected in December but a rebound in wages pointed to sustained labor market momentum that sets up the economy for stronger growth and further interest rate increases this year. Chicago Federal Reserve President Charles Evans said on Friday the central bank could raise interest rates three times this year, faster than he had expected just a few months ago and in line with the majority of his colleagues. The outlook for U.S. rates may become a little clearer when Federal Reserve Chair Janet Yellen appears at a webcast town hall meeting with educators on Thursday.
Two regional Fed presidents will speak later Monday, and there are no less than five speeches lined up for Thursday. The main economic release of the week is not until Friday, when retail sales figures for December are out.
Hedge funds and money managers cut their bullish position in COMEX gold contracts for the eighth straight week in the week to Jan. 3, taking it to the smallest in 11 months, U.S. Commodity Futures Trading Commission data showed on Friday. Gold demand in Asia gathered some steam last week on wedding season purchases in India, with prices swinging to a premium there for the first time in over a month, and traders expecting demand to strengthen due to the upcoming Chinese New Year.
Gold prices fell on Friday, retreating from the previous sessions one-month highs as the dollar strengthened against a currency basket after U.S. jobs data showed a slowdown in hiring in December but a pickup in wage growth. Gold for February delivery settled down 0.73% at $ 1,172.65 on the Comex division of the New York Mercantile Exchange. The metal was still 1.97% higher for the week, its best weekly performance in two months, helped by a broad weakening of the dollar earlier in the week. The Labor Department said Friday the U.S. economy added 156,000 jobs in December, falling short of economists forecast for jobs growth of 178,000. The report also showed that the annual rate of wage growth rose to 2.9% in December from a year earlier, the strongest since 2009. The employment data indicated that the economy is improving enough for the Federal Reserve to keep pushing up interest rates. The Fed has indicated that three quarter-percentage-point interest rate increases are on the cards for 2017. Higher ratesGold prices were little changed early on Monday, after dipping from a one-month high last week on expectations of further interest rate hikes, with investor attention on more views from the U.S. Federal Reserve. boost the dollar by making the currency more attractive to yield-seeking investors. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, jumped 0.77% to 102.17 late Friday. The index had fallen in the previous two sessions after touching a 14-year high of 103.82 on Tuesday. Both a strong dollar and higher interest rates are typically bearish for gold, which is denominated in dollars and struggles to compete with yield-bearing assets when borrowing costs rise. Elsewhere in precious metals trading, palladium ended at a five-week high of $ 758.35 late Friday. The metal, which is used in vehicle catalysts to clean exhaust emissions ended the week with gains of around 11% after data showing U.S. sales of new cars and trucks hit a record high in 2016. Silver was down 0.73% at $ 16.52 a troy ounce late Friday, after touching highs of $ 16.76 in the previous session, its highest since December 15. Copper was up 0.18% at $2.54 a pound and ended the week up 1.6%.
Platinum was down 0.32% on the day at $972.85 an ounce but was up almost 7.5% for the week. The metal touched its highest since November 11 at $979.75 on Thursday. In the week ahead, investors will be looking ahead to U.S. economic reports, particularly Friday’s retail sales figures for December.
Investors will also be watching an appearance by Fed Chair Janet Yellen on Thursday and speeches by a handful of other Fed officials during the week.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, January 9
Financial markets in Japan will be closed for a holiday.
Australia is to release data on building approvals.
The U.K. is to release industry data on house price inflation.
Boston Fed President Eric Rosengren and Atlanta Fed President Dennis Lockhart are to speak.

Tuesday, January 10
Australia is to report on retail sales.
China is to release data on consumer and producer prices.
Canada is to publish figures on building permits.

Also Wednesday, U.S. President-elect Donald Trump is scheduled to hold his first post-election news conference, which investors will be watching for any hints about the possible direction of economic policy.

Wednesday, January 11
The U.K. is to release a report on manufacturing and industrial production as well as trade data.
Thursday, January 12
The European Central Bank is to publish the minutes of its last monetary policy meeting.
Canada is to report on new house price inflation.
The U.S. is to release the weekly jobless claims report along with data on import prices.
Fed Chair Janet Yellen is to speak at an event in Washington.
Also Thursday, Philadelphia Fed President Patrick Harker, Chicago Fed President Charles Evans, Atlanta Fed's Dennis Lockhart, St. Louis Fed President James Bullard and Dallas Fed President Rob Kaplan are due to speak.

Friday, January 13
China is to report on the trade balance.
The U.S. is to round up the week with reports on retail sales, producer prices and a preliminary look at consumer sentiment.
Philadelphia Fed President Patrick Harker is also to speak.Gold slipped on Friday from the previous day's one-month high as the dollar strengthened against a basket of currencies, lifted by U.S. non-farm payrolls data that showed a slowing in hiring last month but an increase in wages. The report supported the view that the U.S. Federal Reserve will press ahead with interest rate increases this year, analysts said. Spot gold XAU= was down 0.4 percent at $1,175.90 an ounce by 1526 GMT. The metal was still 2.2 percent higher this week, its biggest weekly rise in two months, helped by a broad weakening of the dollar earlier in the week and a retreat in U.S. bond yields. But with markets uncertain ahead of Donald Trump's inauguration on Jan. 20, investors turned cautious after gold reached its highest since Dec. 5 at $ 1,184.90 on Thursday. "Any profit that can be booked at this early stage is welcomed by most, so that's why we're seeing a scaling back a bit," U.S. gold futures GCcv1 were down 0.4 percent at $ 1,176.30. Non-farm payroll data showed that the United States added 156,000 jobs in December, less than expected, but a rebound in wages pointed to sustained labour market momentum, stronger growth and further interest rate rises from the Fed. data "doesn't change much in terms of the interest rate outlook. The Fed has indicated that it will press ahead with further rate hikes this year after its second in a decade last month. Higher interest rates exert downward pressure on the gold price by increasing the opportunity cost of holding non-yielding bullion. "If we can manage to hold above $ 1,162 then the market has the potential of moving up towards testing the really big area of resistance, which is just above $ 1,200.
Gold on Friday slipped from the one-month high touched in the previous session on a surge in dollar, with traders waiting for U.S. jobs data later in the day for clues on the pace of possible U.S. interest rate hikes this year. Spot gold XAU= eased 0.3 percent to $ 1,176.36 per ounce by 0543 GMT. The metal on Thursday hit its highest since Dec. 5 at $ 1,184.90. U.S. gold futures GCcv1 were down 0.4 percent, at $ 1,177 per ounce. "We can see a bit of profit-taking ahead of the nonfarm payroll data," A firm dollar will put pressure on gold prices ahead of Donald Trump's inauguration. U.S. services sector activity held at a one-year high in December as new orders surged, while the number of Americans filing for unemployment benefits fell near a 43-year-low last week, suggesting the economy ended 2016 with strong momentum. dollar index .DXY , which measures the greenback against a basket of currencies, was up 0.2 percent at 101.680. Investors are focused on Friday's U.S. nonfarm payrolls report, with economists expecting job gains of 178,000 in December. U.S. Fed has indicated that it would press ahead with further interest rate hikes this year after its second rate increase in a decade last month. Positive data usually puts pressure on gold prices, because investors raise bets on a U.S. interest rate hike that would increase the opportunity cost of holding non-yielding bullion. Spot gold failed to break a resistance at $ 1,182 per ounce and it may either hover below this level or retrace to a support at $ 1,159. Technical charts look a bit weak on the daily side and prices might come down to the around $ 1,160. Holdings of SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, fell 0.03 percent to 813.59 tonnes on Thursday from Wednesday. They have fallen over 14 percent since the U.S. presidential election in November. Among other precious metals, spot silver XAG= fell 0.8 percent to $ 16.42. Silver hit a high of $ 16.71, its best since Dec. 15, in the prior session.
Gold on Friday hovered near one-month highs touched the session before, with traders waiting for U.S. jobs data later in the day for clues on the pace of possible U.S. interest rate hikes in 2017.

FUNDAMENTALS
Spot gold XAU= had eased 0.2 percent to $1,178.53 an ounce by 0056 GMT. The metal on Thursday hit its highest since Dec. 5 at $1,184.90.
U.S. gold futures GCcv1 were also down 0.2 percent, at $1,179 an ounce.
Investors are focused on Friday's U.S. non-farm payrolls report, with economists expecting job gains of 178,000 in December.
U.S. services sector activity held at a one-year high in December as new orders surged, while the number of Americans filing for unemployment benefits fell near a 43-year-low last week, suggesting the economy ended 2016 with strong momentum. A raft of data from China in coming weeks is expected to show the world's second-largest economy carried solid momentum into 2017, thanks to heavy government stimulus and a construction boom that breathed new life into its ailing smokestack industries. Euro zone producer prices rose for the third consecutive month in November on a monthly basis, mostly driven by soaring energy prices which offset subdued prices for consumer goods, estimates released on Thursday by Eurostat showed. SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, said its holdings fell 0.03 percent to 813.59 tonnes on Thursday from Wednesday.

MARKET NEWS
The U.S. dollar wobbled near three-week lows and U.S. bonds were bought back on Friday as investors wound back 'Trump trade', helping to lift the world's stocks to 1-1/2 year highs.
Oil prices were little changed on Friday after gaining nearly 1 percent the day before on news that Saudi Arabia had cut production to meet OPEC's agreement to reduce output.
Gold touched its highest in four weeks on Thursday as the dollar slipped further from a 14-year peak hit earlier this week. Spot gold XAU= rose as much as 1.4 percent to its highest since Dec. 7 at $ 1,179.36 an ounce and was up 0.7 percent at $ 1,171.46 by 1128 GMT. U.S. gold futures GCcv1 climbed $ 6.90 to $ 1,172 an ounce. Spot prices are heading for a near two percent gain for the week so far, having benefited from a halt in the dollar's rise. "Although the wider picture hasn't changed and U.S. growth is improving, there shouldn't be any further significant appreciation in the dollar after the strong run of the past few months and given uncertainty about economic policy changes going forward. This should be supportive for dollar-denominated gold. The metal, mostly used to clean exhaust emissions from gasoline-powered catalysts, has been bought in anticipation of record-high vehicle sales in the United States and was also boosted by a lower dollar. U.S. car sales December data on Wednesday showed sales of new cars and trucks rose to a record in 2016. dollar . DXY fell 0.2 percent against a basket of six main currencies. Minutes from the Federal Reserve's December meeting showed almost all policymakers thought the economy could grow more quickly due to fiscal stimulus under the Trump administration. At the same time, Fed policymakers "emphasized their considerable uncertainty" about future economic policy changes. gold fell more than 8 percent in November and touched a 10-month low in December, on a higher dollar and U.S. Treasury yields after Donald Trump's election win and as the Fed raised interest rates for the first time in a year. It has now increased around 5 percent from its lows.
Buying from China, the biggest consumer of the yellow metal, is also supporting the recent rally. "The Chinese New Year is around the corner. Gold kilobar demand is picking up right now with strong premiums in the mainland. Holdings of the SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, were unchanged on Wednesday at 813.87 tonnes. They have dropped about 14 percent since the U.S. presidential election in November. Spot silver XAG= was up 0.7 percent at $ 16.54, after hitting a 3-week high of $ 16.70.
Gold prices eased on Wednesday after hitting a three-week high in the previous session, with the U.S. dollar hovering near 14-year peaks against a basket of major currencies.

FUNDAMENTALS
Spot gold XAU= was down 0.2 percent at $1,156.96 an ounce by 0051 GMT. It marked its highest since Dec. 14 on Tuesday at $1,163.52.
U.S. gold futures GCcv1 fell 0.4 percent to $1,157.70 per ounce.
The dollar index .DXY , which measures the greenback against a basket of currencies, was at 103.34 after climbing to 103.82 the previous day, its strongest since December 2002.
Holdings of the SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, dropped 1.01 percent to 813.87 tonnes on Tuesday.
U.S. factory activity accelerated to a two-year high in December amid a surge in new orders and rapidly rising raw material prices, indicating that some of the drag on manufacturing from prolonged dollar strength and a slump in oil prices was fading. Other data on Tuesday showed U.S. construction spending hit a 10-1/2-year high in Nvember, providing a boost to a fourth-quarter economic growth estimate. The reports suggested President-elect Donald Trump would inherit a strong economy, with a labour market that is near full employment, from the Obama administration.
China's factory activity picked up more than expected in December as demand accelerated, with output reaching a near six-year high, a private business survey showed on Tuesday, giving the manufacturing sector a solid boost heading into 2017.

Gold prices rose 1 percent to a near 3-week high on Tuesday as early gains in stocks and other assets perceived as risky gave up gains and investors fled to save-haven bullion. Platinum and palladium both jumped by more than 4 percent as investors scrambled for position as the new year got under way. The themes of late 2016 appeared to be persisting in the wider markets, with equities rising while the dollar index touched a 14-year high boosted by strong economic data. As the session progressed, the dollar and equities pared gains, supporting gold prices. Spot gold XAU= was up 0.6 percent at $ 1,159.06 an ounce by 2:17 p.m. EST , while U.S. gold futures GCv1 for February delivery ended the session up 0.9 percent at $ 1,162. The metal fell sharply in the wake of Donald Trump's victory in November's U.S. presidential election, sliding by more than 12 percent in the fourth quarter. Trump's victory boosted the dollar and sparked a sharp rally in bond yields, lifting the opportunity cost of holding non-yielding gold and blunting investors' appetite for the metal. However, Trump could also boost investor interest in the precious metal, some market participants said. "We are not going to dismiss the precious metal completely considering we still have the Trump card in the pack," "At a time when even his tweets are destabilising stocks, any erratic policy proposals, let alone mismanaged implementation, can potentially trigger market uncertainty and increase the investors' interest in gold." Indications from the U.S. Federal Reserve that it would press ahead with further interest rate rises this year are also buoying the dollar and pressuring gold. A strong start to 2016 meant that gold still managed to end last year with its first annual gain since 2012, rising by 8.5 percent. Spot platinum XPT= was up 4 percent at $935.24` per ounce after rising by more than 5 percent. Meanwhile, sister metal palladium XPD= was up 4.5 percent to $ 709 after rising by about 5 percent. "The repositioning in the futures market in the dying weeks of last year saw in platinum a rebuilding in the gross short position, and at the same time long positioning remaining fairly steady. "Right now I think this is some short-covering driving prices higher. "It's the start of the year, and there are some funds rebalancing their portfolios. There might be some niche funds that are interested in these metals, so that is part of the mix as well." Palladium was the best-performing precious metal last year, with the price rising 20 percent for its biggest annual gain in six years. Platinum lagged gains in the wider complex, however, ending 2016 only 1 percent higher. Both metals are widely used in auto catalyst manufacturing, and are more exposed than gold to the economic cycle. Spot silver was up 2.23 percent at $16.29 per ounce.

Gold prices ticked higher in the first trading session of 2017 on Tuesday, but gains were limited as the prospect of rising U.S. interest rates this year kept sentiment bearish. Gold for February delivery on the Comex division of the New York Mercantile Exchange tacked on $ 2.00, or around 0.2%, to $1,153.75 a troy ounce by 3:50AM ET. The U.S. dollar rose on Tuesday, crawling back toward its 14-year-high against a basket of currencies with markets focused on the possibility of further U.S. interest rate hikes in 2017. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.55% at 102.93 in early trade, not far from last week's 14-year peak of 103.62. Market analysts warned that the outlook for gold remains cloudy in the near-term amid expectations of U.S. interest rates rising more rapidly during the incoming Trump Administration. The Federal Reserve hiked interest rates for the first time in a year last month and projected three more increases in 2017. Prices of the yellow metal have fallen sharply since Donald Trump was elected president as a soaring U.S. dollar, rising Treasury yields and a record-breaking rally on Wall Street have dampened its appeal. The precious metal is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar in which it is priced. Both a strong dollar and higher interest rates are typically bearish for gold, which is denominated in dollars and struggles to compete with yield-bearing assets when borrowing costs rise. Also on the Comex, silver futures for March delivery added 7.3 cents, or 0.45%, to $16.02 a troy ounce during morning hours in New York. Meanwhile, platinum tacked on 0.4% to $ 909.50 and palladium inched up 0.1% to $ 683.73 an ounce. Elsewhere in metals trading, copper futures rose 1.9 cents, or 0.8%, to $ 2.525 a pound following a survey showing a pickup in China's factory activities for December. The China Caixin manufacturing purchasing managers' index, a private gauge of nationwide factory activity, rose to 51.9 in December from 50.9 in November. The figure marked the strongest upturn in Chinese manufacturing conditions since January 2013. The Asian nation is the world’s largest copper consumer, accounting for almost 45% of world consumption last year.
Gold began the new year quietly, edging up slightly on Tuesday, despite pressure from a strong dollar.

FUNDAMENTAL
Spot gold XAU= rose 0.2 percent to $ 1,154.26 per ounce at 0109 GMT.
Bullion gained more than 8 percent in 2016, snapping three years of declines.
U.S. gold futures rose 0.3 percent at $1,155.4
The most active COMEX gold futures contract finished 2016 up 7.1 percent as compared to the end of 2015 after strong gains on economic uncertainty earlier in the year were pared by heavy selling as the U.S. dollar rallied following the U.S. presidential election. The dollar index - which measures the greenback against six major rivals - climbed over half a percent.
The U.S. dollar held on to broad gains on Tuesday, resuming its ascent after last week's brief wobble as the prospect of rising U.S. interest rates this year kept sentiment bullish on the long-run.
Asian stocks began 2017 on a flat note on Tuesday, uninspired by a surge in European markets to their highest in more than a year, while the dollar resumed its climb after last week's stumble.
Starting in July 2017, banks and other financial institutions in China will have to report all domestic and overseas cash transactions of more than 50,000 yuan ( or $7,201), compared with 200,000 yuan previously, the central bank said on Friday. China's new rules on overseas currency transfers are not capital controls, the official Xinhua news agency reported, even as some banks told customers that purchases of foreign currency for property, securities and life insurance were not allowed. After a late-year rally fuelled by the U.S. election pushed stocks to surprising new peaks, investors are wary that the market could be primed for a spill to start 2017. Hedge funds and money managers slashed their net long positions in COMEX gold to a near 11-month low and trimmed bullish bets in Silver contracts in the week to Dec. 27, U.S. Commodity Futures Trading Commission data showed on Friday. SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, said its holdings fell 0.14 percent to 822.17 tonnes on Friday from 823.36 tonnes on Thursday.

ENERGY
Oil prices fell early on Monday as Iran increased exports undermining efforts by other oil producers to curb a global fuel supply overhang and as U.S. drillers increased activity for a 10th week. Brent crude futures LCOc1 , the international benchmark for oil prices, were trading at $ 56.97 per barrel at 0019 GMT, down 13 cents from their last close.
U.S. West Texas Intermediate crude oil futures CLc1 were trading at $ 53.79 per barrel, down 20 cents. The lower prices were a result of rising exports from Iran that come just as other members of the Organization of the Petroleum Exporting Countries cut supplies in an effort to end a global glut. Iran has sold more than 13 million barrels of oil held on tankers at sea, capitalising on an OPEC output cut deal from which it is exempted to regain market share and court new buyers, according to industry sources and data.
The amount of Iranian oil held at sea has dropped to 16.4 million barrels, from 29.6 million barrels at the beginning of October, Before that sharp drop, the level had barely changed in 2016; it was 29.7 million barrels at the start of last year, the data showed. surging tanker exports weren't the only indicator of plentiful supplies. In the United States, U.S. energy companies last week added oil rigs for a tenth week in a row, extending the drilling recovery into an eighth month as crude prices remained at levels at which many U.S. drillers can operate profitably. "The next leg up in prices probably won't occur until the traders see evidence that production levels are falling. In the meantime, rising U.S. drilling activity and output is likely to keep prices in check,"
Drillers added four oil rigs in the week to Jan. 6, bringing the total count up to 529, the most since December 2015, energy services firm Baker Hughes Inc BHI.N said on Friday. a result of the increased drilling for new production, U.S. oil output C-OUT-T-EIA has risen by over 4 percent since its 2016 low to almost 8.8 million barrels per day, although production remains 8.74 percent below its 2015 peak.
Oil futures finished slightly higher on Friday, logging their fourth weekly gain in a row with traders encouraged by signs that major crude producers will adhere to the pledge to curb output. On the New York Mercantile Exchange, crude oil for delivery in February inched up 23 cents, or about 0.4%, to end at $ 53.99 a barrel by close of trade Friday.
U.S. crude prices touched an 18-month high of $ 55.24 on Tuesday.
For the week, New York-traded oil futures added 97 cents, or about 1.8%, after posting gains in each of the previous three weeks. Elsewhere, on the ICE Futures Exchange in London, Brent oil for March delivery tacked on 21 cents, or nearly 0.4%, to settle at $ 56.82 a barrel by close of trade. Brent prices rallied to $58.37 on Tuesday, a level not seen since July 2015. London-traded Brent futures logged a gain of 28 cents, or approximately 0.5%, on the week. Prices tallied a weekly gain amid signals that major oil producers, such as Saudi Arabia and Kuwait, are sticking to their pledge to cut back output.
January 1 marked the official start of the deal agreed by OPEC and non-OPEC member countries such as Russia in November last year to reduce output by almost 1.8 million barrels per day. The deal, if carried out as planned, should reduce global supply by about 2%. However, some traders remain skeptical that the planned cuts will be as substantial as the market currently expects. There are also some worries in the market about production increases in Libya and Nigeria, which are both allowed to ramp up production as part of the OPEC deal. Meanwhile, indications of increased drilling activity in the U.S. remained in focus. According to oilfield services provider Baker Hughes, the number of rigs drilling for oil in the U.S. last week increased by 4 to 529, the tenth straight weekly rise and a level not seen in almost a year.
Some analysts have warned that the recent rally in prices could be self-defeating, as it encourages U.S. shale producers to drill more, adding to concerns over a global supply glut. Elsewhere on Nymex, gasoline futures for February shed 0.3 cents, or 0.2% to $1.634 a gallon. It ended down about 2.2% for the week. February heating oil ticked up 0.9 cents, or 0.5%, to finish at $1.728 a gallon. For the week, the fuel declined around 1.5%. Natural gas futures for February delivery settled 1.2 cents, or 0.4%, higher at $3.285 per million British thermal units, but still lost 43.9 cents, or 11.8%, on the week, as forecasts of mild January weather replaced predictions of severe cold. In the week ahead, market participants will eye fresh weekly information on U.S. stockpiles of crude and refined products on Tuesday and Wednesday to gauge the strength of demand in the world’s largest oil consumer.
Traders will also continue to pay close attention to comments from global oil producers for further evidence that they are complying with their agreement to reduce output this year.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Tuesday, January 10
The American Petroleum Institute, an industry group, is to publish its weekly report on U.S. oil supplies.

Wednesday, January 11
The U.S. Energy Information Administration is to release weekly data on oil and gasoline stockpiles.

Thursday, January 12
The U.S. EIA is to produce a weekly report on natural gas supplies in storage.

Friday, January 13
Baker Hughes will release weekly data on the U.S. oil rig count.
Oil rose slightly on Friday on futures buying, ending the week higher, but gains were limited by a strong U.S. dollar and lingering doubts about whether OPEC producers would stick to a deal to cut output. Market players attributed choppy trading to position-squaring at the end of the week and low volumes at the start of the year. Brent crude futures LCOc1 settled 21 cents higher at $ 57.10 per barrel, after trading in a range of $ 56.28 to $ 57.47. The contract posted gains for the second week in a row. U.S. West Texas Intermediate crude futures CLc1 ended the session up 23 cents at $ 53.99 a barrel, after swinging between $ 53.32 and $ 54.32. WTI notched its third straight weekly gain. "There's a lot of volatility, or at least changes in direction. "People think the long-term trend is up, but after a gain of a few dollars, they take profit." The dollar .DXY gained broadly after the U.S. non-farm payrolls report showed slower hiring in December but an increase in wages, feeding expectations of further interest rate increases from the Federal Reserve this year. stronger greenback makes oil more expensive for holders of other currencies. Top crude exporter Saudi Arabia and fellow Gulf members Abu Dhabi and Kuwait showed signs they were cutting production in line with an agreement by members of the Organization of the Petroleum Exporting Countries and other producers, yet market watchers have doubts about overall compliance. signs that producers are reneging on their commitments could cause sentiment to sour and cause prices to fall back sharply.

U.S. energy companies this week added oil rigs for a 10th week in a row, bringing the total count up to 529, the most since December 2015,
"Market balances are unquestionably tightening, but concerns pertaining to the pace at which the global storage glut will be drawn down toward historically normal levels will be the focal point for the year ahead," "While the market has centered its attention on the notional size of the announced cuts from both OPEC and non-OPEC countries and whether or not the group will deliver on its promises, we believe that an important factor is being overlooked ... the deal inadvertently tightens the medium and heavy balances incrementally more than the light, sweet market."
Oil was slightly higher Friday, as hopes that a landmark agreement between major producers to cut output continued to support prices and investors looked ahead to data on U.S. drilling activity. U.S. crude was up 35 cents, or 0.65%, at $54.11 at 06:50 ET, while Brent crude gained 39 cents, or 0.69%, to $ 57.28. Reports out Thursday of supply cuts from Saudi Arabia and Abu Dhabi coming into effect as part of efforts by the OPEC and other producers to curb a global supply glut gave oil prices upside. Also supporting black gold, official EIA data out a day earlier saw crude stockpiles decline by 7.1 million barrels, compared to expectations for a drop of 2.2 million. Still, market participants were cautious on Friday ahead of the U.S. employment report for December. A rate rise may strengthen the U.S. dollar, which could depress oil prices as it would make the greenback-denominated commodity more expensive for holders of other currencies. Investors also looked ahead to the Baker Hughes U.S. rig count data for the latest week. Last week, the oilfield services provider said that the number of rigs drilling for oil in the U.S. increased by 2 to 525 in what was the ninth straight weekly rise and a level not seen in almost a year.
Oil prices edged up on Wednesday, recovering some losses from the previous day when the U.S.-dollar hit a 14-year peak and weighed on crude markets. U.S. West Texas Intermediate crude oil futures CLc1 were trading at $ 52.58 per barrel at 0026 GMT, up 25 cents, or 0.5 percent, from the last settlement. International Brent crude futures LCOc1 had yet to trade. Traders said that the increase was due to a dip in the U.S. dollar, making dollar-traded fuel purchases for countries using other currencies at home slightly cheaper. The move came after the dollar hit a 14-year peak on the back of strong U.S. economic data. Wednesday's dip in the dollar, analysts expect the greenback to remain strong in the near future. "The dollar remains supported due to the fact that the Fed has not only turned hawkish but it has already started its policy tightening cycle, while the rest of the major central banks are pretty much dovish across the board. moves in foreign exchange markets would likely be a strong driving factor in crude markets, as investors weigh the prospects of money markets over commodity futures. In physical oil markets, all eyes are on plans by major oil producers like the Organization of the Petroleum Exporting Countries to cut crude supplies from this month in an effort to end global oversupply that has dogged markets for over two years. Reflecting a tightening market, top oil exporter Saudi Arabia is expected to raise official selling prices for all its crude grades to Asia in February. for physically delivered crude to customers around the world are a key indicator in determining the prices for crude oil futures like Brent or WTI. "Crude oil has risen... on expectations of reduced supply excess.
Oil prices climbed to 18-month highs on the first trading day of 2017 on Tuesday amid hopes that an agreement between major producers to cut production will be effective in reducing a global supply glut and rebalancing markets. Brent crude was trading up $ 1.33, or 2.34% at $ 58.15 a barrel at 08.10 Eastern Time, the highest level since July 2015. Oil markets were closed on Monday after the New Year's holiday. U.S. crude oil was $1.3, or 2.42% at $55.02, also it's highest since July 2015.
January 1 marked the official start of the deal agreed by the Organization of Petroleum Exporting Countries and non-OPEC members in November to slash output by almost 1.8 million barrels per day. Market analysts have said January will serve as an indicator of whether the agreement will be carried out.
Spot deals were limited in the first full trading day of 2017, while the crude oil futures contracts on which West African oil is priced were notably volatile.
Several pending tenders tied up some seller interest, with Indian firms IOC and BPCL running buying tenders.
Crude oil futures traded at 18-month highs before crashing more than $1 per barrel below the previous close due to a resurgent U.S. dollar and questions surrounding OPEC's plans to cut production.
A fire this week hit the Ivory Coast oil refinery SIR, which often processes West African crude, but the company said that units apart from the hydrocracker where it started had not been affected. Traders expect Saudi Arabia to raise its official selling prices to Asia, which could help West African grades compete for buyers in the region. Spot buying demand was all but absent, with those holding Nigerian cargoes targeting tender buyers in India.
Loading delays plagued Exxon Mobil's production after workers in Nigeria staged industrial action late last year.
February loadings were impacted by the delays, and stood at 1.58 million bpd. Four planned cargoes of Akpo condensate not included in the total.
Awards for 2017 contracts were expected any day.
Traders said there was a limited amount of oil left available after buying concluded quietly over the holidays.
The premium of Brent crude to Dubai crude futures fell to $1.90 per barrel, less than half the level of the same time last year and close to the 2016 low of $ 1.79.
A smaller gap makes oil priced versus Brent more attractive to the Asian buyers on which Angola depends.
Oil prices rose on Tuesday, the first trading day of 2017, buoyed by hopes that a deal between OPEC and non-OPEC members to cut production, which kicked in on Sunday, will drain a global supply glut.
Benchmark North Sea Brent crude LCOc1 was up 40 cents at $57.22 a barrel by 0845 GMT, not far below the 2016 high of $ 57.89, reached on Dec. 12. U.S. light crude oil CLc1 was up 40 cents at $54.12 a barrel. Oil futures markets were closed on Monday for New Year public holidays. Jan. 1 marked the official start of a deal agreed by the Organization of the Petroleum Exporting Countries and other exporters such as Russia to reduce output by almost 1.8 million barrels per day. signals suggest the OPEC and non-OPEC production cuts are raising hopes that the global oil oversupply will diminish. "Markets will be looking for anecdotal evidence for production cuts. "The most likely scenario is OPEC and non-OPEC member countries will be committed to the deal, especially in early stages."Libya, one of two OPEC countries exempt from the output cuts, has increased its production to 685,000 bpd, from around 600,000 bpd in December, an official at the National Oil Corporation said on Sunday. non-OPEC Middle Eastern oil producer Oman told customers last week that it would cut its crude oil term allocation volumes by 5 percent in March. Russia's oil production in December remained unchanged at 11.21 million bpd, near a 30-year high, but it was preparing to cut output by 300,000 bpd in the first half of 2017 in its contribution to the accord.
U.S. oil prices rose in the first trading hours of 2017 on Tuesday, buoyed by a deal for OPEC and non-OPEC production cuts which kicked off on Sunday. U.S. benchmark West Texas Intermediate CLc1 crude oil prices were up 35 cents, or 0.7 percent, at $ 54.07 at 0010 GMT, not far from last year's high of $ 54.51 reached on Dec. 12. International Brent crude oil LCOc1 was yet to trade after closing up 68 cents at $56.82 per barrel on Friday. Oil markets were closed on Monday after New Year's holiday. Jan. 1 marked the official start of the deal agreed by the Organization of Petroleum Exporting Countries and non-OPEC member countries such as Russia in November last year to reduce output by almost 1.8 million barrels per day. will serve as an indicator for whether the agreement can stick.Libya, one of two OPEC member countries exempt from the deal, increased its production to 685,000 barrels per day as of Sunday, up from around 600,000 a day in December, according to an official from the National Oil Corporation. OPEC member countries, Oman notified its customers last week that it will cut its crude term allocation volumes by 5 percent in March. member Russia's oil production in December remained unchanged at 11.21 million bpd, but it was preparing to cut output by 300,000 bpd in the first half of 2017 as part of its efforts to join the global deal to reduce oversupply and rebalance the market.

With global oil markets closed on Monday and crude prices having pocketed gains of around 50% during 2016, traders prepared to watch developments surrounding the landmark deal reached by the Organization of the Petroleum Exporting Countries and several non-OPEC oil producers to reduce their output this year.

Oil futures finished with modest losses in the final trading session of 2016 on Friday, but scored the biggest annual gain since 2009 in the wake of the agreement to tackle the global supply glut and support crude prices.
OPEC members agreed to lower production by a combined 1.2 million barrels per day starting on Sunday, January 1, their first such deal since 2008. The pact was followed by an agreement from 11 non-OPEC producers, led by the largest producer outside the cartel Russia, to reduce their supplies by 558,000 barrels a day. The deal, the first of its kind in 15 years, aimed to reduce global supply by about 2%. From more than $110 per barrel in 2014, oil prices dropped to its February bottom at a 13-year low of around $26-per-barrel before recovering in later months as oil-producing countries made efforts to limit production. Brent oil ended 2016 with an annual rise of 52%, while U.S. crude futures pocketed gains of nearly 45%. Markets skeptical of output cut compliance, However, some traders remain skeptical that the planned cuts will be as substantial as the market currently expects. Notably, Moscow promised to account for 300,000 barrels per day of the 558,000 included in the agreement among non-OPEC producers. However, Russia also indicated that it planned to reach a reduction of 200,000 barrels by March with the additional 100,000 being cut by June. There are also some worries in the market about production increases in Libya and Nigeria, which are both allowed to ramp up production as part of the OPEC deal. Many analysts have also put into question just how much of the agreement will be carried out. Both JP Morgan and Goldman Sachs put their forecast for compliance at 80% and 84%, respectively. “We now harbor mounting concerns that cheating will inevitably undermine commitment to the agreement at some point in the second semester,” JP Morgan suggested. Goldman explained their less-than-100% forecast was “given that compliance to cuts outside of Gulf Cooperation Council producers (Saudi Arabia, Kuwait, United Arab Emirates, Qatar, Bahrain and Oman) has historically been poor.” On the near-term horizon, investors will likely have to wait for their possible first taste of compliance when the monitoring committee meets in Vienna. Though OPEC secretary general Mohammed Barkindo had floated a date of January 13, Kuwaiti oil minister Issam Al-Marzouq confirmed that the first meeting would come later. "Preparations are under way to hold a meeting for the Kuwait-chaired special commission tasked with monitoring adherence to crude oil cut on January 21-22 in Vienna," the minister said last Wednesday, according to a report from the state-run Kuwait News Agency. “It should become better known in a few weeks, around when Donald Trump takes office, just how much is being cut and how much is smoke-and-mirrors,” Boslego Risk Services founder Robert Boslego said in an analysis.“The cuts announced are unlikely to all start this month,” he said, also warning that Russia does not follow through, it would be unlikely that many other Non-OPEC voluntary cuts will materialize either."You get until January 21 to believe your hoped-for outcomes and then you converge with reality,” Clear View Energy Partners managing director Kevin Book told CNBC, affirming that cheating on the deal was “inevitable”. “Historically OPEC always blows past its targets," he added. U.S. shale producers likely to cap upside on oil prices Meanwhile, indications of increased drilling activity in the U.S. remained in focus. Oilfield services provider Baker Hughes said late Friday that the number of rigs drilling for oil in the U.S. during the previous week increased by 2 to 525, the ninth straight weekly rise and a level not seen in almost a year. Some analysts have warned that the recent rally in prices could be self-defeating, as it encourages U.S. shale producers to drill more, adding to concerns over a global supply glut. “As higher prices kick in, shale production would likely quickly ramp up, effectively capping oil prices above $ 60," analysts at Standard & Poor’s explained. Ellen R. Wald, Ph.D., expert on the global energy industry, believes that oil prizes will stabilize in 2017, as OPEC “is once again saying the right things and working towards cooperation to limit production and raise prices.” “The OPEC production cuts may never be implemented fully and likely will not last for too long, and further hurdles remain to bringing the full range of non-OPEC producers on board, but the movement is now clearly in the direction of combined production limits,” she explained.


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