Brent crude oil resumed its downward trend last week,  dipping to a fresh two-year low as it came  under further pressure from rising supply in Libya, Iraq and Nigeria. U.S. crude prices, on the other hand, gained after a surprise fall was reported in country’s crude inventories.

Brent crude for November delivery on the London-based ICE Futures Europe exchange slipped below $96 a barrel at one point on Sept. 25, marking a fresh two-year low before clawing back some of the losses to settle at $97 a barrel, up $0.05 on the day.

West Texas Intermediate (WTI), the U.S. light, sweet crude benchmark, for delivery on the New York Mercantile Exchange (Nymex) in the same month added $1.24 to close at $92.80 a barrel on Sept. 24, after data from the American Petroleum Institute (API) showed U.S. crude inventories declined 6.5 million barrels in the week ended Sept. 19. The API figures come a day ahead of the more closely watched Weekly Oil Status report from the  U.S. Energy Information Administration (EIA).

The EIA  data showed the country’s commercial crude stocks had fallen by 4.3 million barrels to 358 million in the week ending Sept. 19. As well as refinery utilization running at a higher rate – 93.4 percent – than a year ago (90.3 percent), crude imports were also lower. According to the EIA, the country’s crude oil imports averaged about 7.6 million barrels per day in the four-weeks to Sept. 19, 4.7 percent below the same four-week period in 2013.  November WTI  on Sept. 25 settled 27 cents lower on the day at $92.53 a barrel.

Strong dollar weighs on precious metals

Among the precious metals, gold continued its downward trend, hitting a nine-month low on Sept. 25 as the U.S. dollar rose to a four-year peak against a basket of currencies and U.S. equities markets strengthened, decreasing the safe-haven appeal of assets like gold. Positive U.S. economic data also reinforced fears the country’s Federal Reserve would raise interest rates soon, further lessening the precious metal’s investor appeal.

Spot gold fell to $1,206.65 a troy ounce on Sept.25  , the lowest since Jan. 2, before rebounding to $1,222.86. On the Comex division of  Nymex, gold futures for December slumped to $1,206.85 a troy ounce before settling at $1,221.90, up $2.4 on the day. The rebound came amid a sharp sell-off in U.S. equities which prompted some players to re-invest in gold as a safe haven.

The strong U.S. dollar was also weighing on other precious metals. Platinum fell to its lowest since June 2013, sliding below $1,300 an ounce, and palladium also dropped.

Platinum for October delivery on Nymex touched  $1,295.25 at one point on Sept. 25 before settling at $1,314.20  an ounce,  down $5.2 on the day. Palladium also slid to its lowest in more than four months at $792 an ounce before trimming some of the losses to close at $802.75, basis the December contract.

Cocoa climbs to a 3½-year high, arabica stays firm

Among soft commodities, cocoa prices traded at their highest in three and a half years on fears that the Ebola virus is spreading further in West Africa, where some 70 percent of the world’s cocoa is typically produced.

Cocoa for December delivery hit $3,399 a tonne on Sept. 25 on the New York ICE Futures U.S. exchange, the highest for a most-active contract since April 2011. ICE December cocoa ended the day lower at $3,343 a tonne after some profit-taking. On London’s NYSE Liffe exchange, cocoa for delivery in the same month finished at £2,140 a tonne.

There are fears that the virus may spread to the top cocoa grower and exporter Cộte d’Ivoire. Ebola has spread in neighbouring Liberia and Guinea. The U.S. Centers for Disease, Control and Prevention on Sept. 18 advised Cộte d’Ivoire to set up a command center and train medical staff to deal with the disease. Some 2,083 people have died between March 23 and Sept. 22, in the current outbreak in West Africa, according to the World Health Organization.

Ghana, the world’s second largest cocoa producer, meanwhile, has said it aims to produce some 100,000 tonnes more cocoa in 2014-2015 (Oct.1-Sept. 30). According to Reuters quoting the country’s Deputy Finance Minister Cassiel Ato Forson, the West African country is targeting an output of around 1 million tonnes in 2014-2015, up from around 900,000 tonnes in the 2013-2014 season about to end on Sept. 30.

Raw sugar futures extended their rally off four-year lows, supported by the latest cane industry data from top producer Brazil. Brazilian sugarcane industry association, Unica, reported Sept. 24 that sugar output in the country’s top cane-growing Center-South region slowed in the first two weeks of September as mills directed more of their cane to ethanol production. The Center-South mills produced 2.5 million tonnes of sugar in the first two weeks of the month, down from 3.02 million tonnes in the second half of August and 2.98 million tonnes in the same period in 2013, Unica said.

October raw sugar futures on ICE had moved as high as 15.39 cents a pound at the time of writing on Sept. 26. It had settled at 14.84 cents the previous day, up $1.33 on where it had closed last week at 13.51 cents. October raw sugar dipped to 13.32 cents on Sept. 17, the lowest level for the most active contract since May 2010. The ICE October contract expires on Sept. 30.

Arabica coffee futures on ICE continued to trade about $1.80 a pound this week, supported by another key industry player reducing its estimate for Brazil’s coffee output in 2015-2016 (April 1-March 31) as a result of the prolonged drought conditions that hit the south of the country early this year. Leading soft commodities analyst F.O. Licht reported its estimate for Brazil’s 2014-2015 coffee output was 43 million 60-kg bags compared with a forecast of 46 million bags for 2014-2015.

ICE December arabica futures traded as high as $1.8818 cents a pound as at the time of writing on Sept. 26. December arabica had settled at $1.8105 cents the previous day after closing at $1.8788 cents on Sept. 24. Earlier this month, December arabica had hit a one-month high of $2.0995 a pound.

While care has been taken to ensure that the information contained in this report is accurate, it is supplied without guarantee. The author can accept no responsibility for any errors or any consequence arising from the information provided.