Oil is still the biggest story in the commodities markets-dropping to a fresh four-year-low this week. US crude oil is on track for its seventh weekly fall in a row, its longest losing streak in nearly three decades.
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Brent crude oil was the biggest loser, falling below $80 a barrel. The bearish news once again came out of OPEC. The oil cartel still appears unwilling to reduce their output in order to ease an oversupply that has sent oil into a bear market. West Texas Intermediate, the other oil contract, also fell. Both have fallen about 30% since their recent highs in June.
“Global petroleum markets are extending their recent decline amid ongoing doubts regarding Chinese and European demand prospects, as well as a growing conviction that OPEC will fail to cut output when it meets Nov. 27 to review policy,” Tim Evans, Energy Futures Specialist at Citi Futures and OTC Clearing, said in a morning note. “More supportive developments…are failing to support prices. This reaction to bearish news and failure to respond to bullish news is the hallmark of a bear market that is reinforcing what is already an entrenched bearish sentiment.”
Commuters are still seeing a notable difference at the pump though. The national average price of gasoline is now $2.92 a gallon, about 25 cents lower than a year ago.
Corn prices, on the other hand, have continued to push higher after hitting multi-year lows in 2014. The grain has made solid gains this week, up more than 3%. The bullish news first came from the U.S. Department of Agriculture, which lowered their expected yields from this year's harvest.
“A slightly smaller U.S. corn crop in the USDA report slowed down the bearish talk,” Alan Brugler, President of Brugler Marketing & Management, said.
Also pushing up prices is an early winter blast. Traders are arguing this will boost demand for animal feed.
Last but not least we have gold, which seems to have finally stabilized after hitting four-year lows. The precious metal is trading up slightly this morning as jobless claims came in higher than expected. The number of Americans filing new claims for unemployment benefits rose 12,000 to 290,000 for the week ended November 8, according to the Labor Department. Economists polled by Reuters had forecast claims increasing to 280,000.