Returns on risk interest, Oil prices rise, Gold glides

Commitments of Traders

Referring to the CFTC Traders Commitments report for the week ended June 2, net purchases of crude oil futures rose +25,756 contracts to 568,330 for this week. Speculative buying positions surged by +27,938 contracts while sales added +2,182 contracts. For refined oil products, net purchases for gasoline fell -7 832 contracts to 53,080, while net length for heating oil futures added +144 contracts to 2,779.

Source : CFTC

Details of OPEC + production cuts

The finalized pact called for collective cuts of 9.6 million barrels per day until the end of next month, Nigeria and Iraq redeemed their savings deposits with deeper cuts over the next three months. Mexico will not pursue restrictions beyond June, because it is still implementing old plans to revive its oil industry. OPEC + compliance with the May agreement was 89%, which means it fell by around 1.1 million barrels from the target set in the April agreement, according to commodity data company Kpler. Deductions will be reviewed every month, with the next meeting set for June 18. (formerly: OPEC + production cuts extended for one month (6 June 2020)

The position of USOIL prices closed at 38.87 last week, with a high price of 39.62, a little below 61.8% which would be a barrier to price increases in the low average price range of 42.00.

Gold futures fell to two-month lows as the US labor market rebounded unexpectedly in May, increasing interest in risk assets. August Comex Gold (XAUUSD: CUR) -2.5% at $ 1,683.50 / oz, and settlement around the current level will be the lowest for the most active contract since April 3; July silver (XAGUSD: CUR) -2.9% to $ 17.54 / ounce.

While the spot gold last week closed at 1684.13 after touching the FE 100.00 level at a low range of 1670.56. The release of the minor support 1670.15 allows the price to test 1650.00. On the upside, 1700.00 is still a parameter. Down bias looks more dominant after forming patterns A, B, C.

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Ady Phangestu

Analyst – HF-Indonesia

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