Oil prices fell by 6% Tuesday – dipping under US$100 a barrel for WTI Crude, as investors drove prices down following the progress in Russia-Ukraine negotiations, and hopes of a conflict settlement.
Oil closed in New York at US$104.12/bbl.
It was also announced that oil demand loss due to high fuel prices in the US might be as high as 300,000 barrels per day – stemming primarily from falls in discretionary driving.
Gas
US natural gas joined crude oil futures in its slide, falling more than 3% on Tuesday.
The forecast of milder weather lessened the need for heating homes coming earlier than expected, along with progress in the talks between Russia and Ukraine drove the drop.
Gas futures for April delivery fell US$0.172, or 3.1%, to settle at US$5.336 per million British thermal units (mmBtu), the lowest close since 23 March.
May futures were down about 4% to around US$5.34/mmBtu.
Natural gas spot prices dropped 3.49% to US$5.59/mmBtu
Gold and metals
Gold and metal commodities fell sharply after the first day of negotiations between Russia and Ukraine.
Early in the day gold fell to US$1,900 per ounce, before closing out the New York market day above US$1,919/oz.
Meanwhile, silver was down more than 2% to US$24.3/oz.
Palladium plummeted by as much as 18% over the past three days, while platinum dropped by 2.5% Tuesday. All three followed gold and oil, with large declines followed by recoveries by the end of trading.
Iron ore
Iron Ore futures dropped after its recent strong climb that reached US$883.68 on 28 March, falling to US$862.71 at the end of the US market day on Tuesday.
Despite China’s heightened COVID-19 curbs, Dalian iron ore hit a seven-month high, climbing above US$150 a tonne thanks to a short-term fund boost by the Central Bank that increased liquidity.
Iron ore’s most-active May contract on the Singapore Exchange rose 1.7% to US$156.85/t.
As well, China’s Commodity Exchange said on Tuesday it would raise trading limits and margin requirements for some of its futures products including iron ore, soybean meal and corn, as of 31 May.
Wheat
Wheat futures were among commodity prices that took a hit on Tuesday, with traders reacting to the progress in negotiations between Ukraine and Russia.
May futures in Chicago SRW Wheat fell 4.2% to US$10.14 a bushel – the lowest settlement since 1 March, according to Dow Jones Market Data.
This compares with a 40% surge at the start of March.
Corn and soybean futures also saw sharp declines Tuesday.
Get the wire before the market opens.
The ASX small-cap stories that matter, filed before 9am AEST. Curated by the Small Caps desk.