Commodities: Oil Holds Above $90, Copper Eases from New Record


Crude oil is steady after rising for a fifth day yesterday following government reports that showed that U.S. inventories dropped and the country's economy grew more than previously estimated in the third quarter.

U.S. stockpiles fell 5.33 million barrels to 340.7 million last week, the lowest level since Feb. 19, the Energy Department said. A decline of 3.4 million barrels was forecast, according to the median of 14 responses in a Bloomberg News survey.

Crude oil for February delivery right now is 0.04 below Wednesday's settlement at $90.48 a barrel, up $0.66, the highest settlement since Oct. 3, 2008.

Metals are lower with gold down $7.30 at $1,380.10 an ounce on the Comex in New York. Copper futures, meanwhile, is another down $0.0495 to $4.2255 after retreating about 0.3% yesterday from a record $4.2965 a pound early in the session.

The International Copper Study Group forecast a 435,000-ton deficit for the metal worthwide last year, reportedly prompting analysts at Goldman Sachs Group Inc. and Standard Chartered Plc to predict higher prices in 2011.

In company news, Rio Tinto Group ( RIO ) will acquire Riversdale Mining Ltd. for about $3.9 billion, gaining much-needed coking coal reserves in in Mozambique as global demand rises. Rio's A$16-a-share offer is a 13% premium to Riversdale stock price before the companies said on Dec. 6 they were discussing a possible deal.

Solitario Exploration & Royalty ( XPL ) and Ely Gold & Minerals (ELY.V) said they have launched a joint venture to develop the Centennial gold deposit in Nevada. Solitrario will pay $300,000 initially in exchange for a 10% stake in the joint venture, which can grow to 80% by completing certain staged commitments.

Also, Ecopetrol S.A. ( EC ) has won approval from Brazilian authorities to participate in Block BM-S-1413, a 160-square-kilometer exploration tract in the Santos Basin, about 300 km southeast of Sao Paulo. Ecopetrol will hold a 13% stake in the offshore project, with Petrobras Argentina ( PZE ) and ONGC Campos Ltda. each owning a 43.5% stake. EC officials said the project is part of its international expansion strategy, which looks to increase daily production to 1.0 million barrels of oil equivalent by 2015 and 1.3 million barrels by 2020.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright (C) 2014 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing , Commodities

Referenced Stocks: EC , PZE , RIO , XPL

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