WTI Crude oil and other commodities during the first six months of 2019
Brent crude oil price fell on Monday despite the fact that the June job report surpassed the expectations. The price of the West Texas Intermediate (WTI) crude oil increased by 6 cents to $57.57 a barrel. However, the Brent crude oil price fell by 3 cents to $64.20. During the previous week, both oil benchmarks decreased as a response to global economic problems. The price of Brent fell by more than 3% while WTI decreased by more than 1.5%. The increase of the WTI crude oil is a positive sign, and the non-farm payrolls report contributed to the growth of WTI crude oil price.
The first half of the year was tough not only for the oil but other commodities as well due to several reasons. The ongoing trade war between the U.S. and China had a negative impact on the global economy. However, oil, along with other commodities such as gold, iron, and others managed to overcome the problems and rose by 7% during the first six months of 2019.
The trade war is just one of the problems as other issues included regional tensions in the Persian Gulf and OPEC+ meeting at the beginning of this month. The oil prices reached the highest point in April when the price of Brent oil rose to $75 a barrel. At the end of June Brent, the crude oil price was $67 a barrel, which is the best result in the first half of the year since 2016.
Another commodity that is on the rise is gold. Since the beginning of the year, gold prices had a positive outlook for most periods of time. It even managed to break the six years old record when the gold prices surpassed the result from 2013. The future is also bright for this precious metal as analysts from Goldman Sachs increased their forecasts. The 12-month forecast is that gold will reach the price of $1,475 per ounce.
Iron ore is also among the commodities which rose since January. The price of iron ore increased by 60% and reached the best result since 2014. The reason why the price of iron ore managed to achieve such a high price is that Brazil and Australia exported less iron ore than in the previous year. Also, the demand from the Chinese companies influenced the price.
The commodity which is experiencing the biggest problem in comparison with other commodities mentioned above is copper. The price of the metal decreased by 11% since April when it reached the best result in nine months. However, according to the expectations copper use will beat the production by 189,000 metric tons for the second half of the year.
To sum up, the first half of the year for the commodities is not as bad as expected. We should take into consideration that the trade war is not over yet and regional tensions are running high. In this situation, the price of oil, gold, and other commodities increased, which is good news for the investors.