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HomeLatest NewsGlobal NewsCommodity Snapshot: Oil Prices Drop, Cocoa Holds Firm Near Record Levels.

Commodity Snapshot: Oil Prices Drop, Cocoa Holds Firm Near Record Levels.

Commodity like Oil prices fell for a second consecutive day on Wednesday, falling more than 1% due to a report that U.S. crude stockpiles rose last week and signs that OPEC+ would not change their output policy at the next meeting.

A more than expected crude build implies weaker demand and is bearish for crude prices. OPEC+ will hold an online joint ministerial monitoring committee meeting on April 3 to review the market and members’ implementation of output cuts.

J.P. Morgan Commodities Research argued that the Russian government’s order to reduce oil output in the second quarter could push Brent oil prices to $90 in April, mid-$90 by May, and close to $100 by September, keeping pressure on the U.S. administration in the run-up to elections.

US gasoline prices are expected to reach $4/gallon by May, the highest since summer 2022, potentially exacerbated by the OPEC+ alliance’s possible extension of oil production cuts in June.

Cocoa prices have surged nearly 130% since the start of the year, up 48% this month and set for a third month of gain. Hershey CEO Michele Buck has a hedging strategy to manage price volatility.

The world is facing the largest cocoa supply deficit in over 60 years, with consumers expected to see the effect at the end of this year or early 2025.

Hershey and Cadbury chocolates are planning to increase prices due to a record-setting surge in cocoa prices. Hershey CEO Michele Buck warns that historical cocoa prices may limit earnings growth this year.

Hershey stock has fallen 23% over the past 12 months, while Mondelez International has only increased 1.3%. The International Cocoa Organization reports a supply shortfall from Côte d’Ivoire and Ghana, affecting both markets across the Atlantic.

Recent Commodity Price Movements
Energy

Crude oil (CL1:COM) -0.62% to $81.11

Natural Gas (NG1:COM) -0.99% to $1.77

Metals

Palladium (XPDUSD:CUR) -1.07% to $983.00

Platinum (XPTUSD:CUR) -0.82% to $895.61

Gold (XAUUSD:CUR) +0.51% to $2,189.63

Copper (HG1:COM) -0.44% to $3.98


Agriculture

Corn (C_1:COM) -0.80% to $428.58

Wheat (W_1:COM) -0.43% to $541.18

Cotton (CT1:COM) +1.52% to $93.42

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Spot gold was trading -0.3% lower at $2,176.89 an ounce as markets awaited the release of U.S. CPI data, which could influence the Federal Reserve’s policy path. A hotter-than-expected reading could delay the central bank’s easing cycle. Low interest rates help bullion by reducing the opportunity cost of holding the zero-yielding asset. A mixed tone prevailed across commodity sectors, with China’s economic growth concerns affecting bulks and supply concerns supporting industrial metals. Commodity Snapshot Commodity Snapshot Commodity Snapshot

Natural gas and crude oil prices were trading in the green, while oil prices fell earlier due to persistent demand concerns in China. NS Trading president Hiroyuki Kikukawa said that concerns over weak demand in China outweighed the extension of supply cuts by OPEC+. Mixed US jobs data prompted some traders to adjust positions. However, losses will be capped by increased geopolitical risk, with the possibility of a ceasefire in the Hamas-Israel war and conflict expansion in Russia and its neighbors. Europe remains the most impacted region, as oil product shipments from Asia have fallen since January. OPEC+’s voluntary production cut agreement could tighten the market as demand recovers from its seasonal lull.

Natural gas and crude oil prices were trading in the green, while oil prices fell earlier due to persistent demand concerns in China. NS Trading president Hiroyuki Kikukawa said that concerns over weak demand in China outweighed the extension of supply cuts by OPEC+. Mixed US jobs data prompted some traders to adjust positions. However, losses will be capped by increased geopolitical risk, with the possibility of a ceasefire in the Hamas-Israel war and conflict expansion in Russia and its neighbors. Europe remains the most impacted region, as oil product shipments from Asia have fallen since January. OPEC+’s voluntary production cut agreement could tighten the market as demand recovers from its seasonal lull.

Commodity Snapshot Commodity Snapshot Commodity Snapshot Commodity Snapshot

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