Cross-Cultural Understanding

www.ccun.org

News, July 2008

 

Al-Jazeerah History

Archives 

Mission & Name  

Conflict Terminology  

Editorials

Gaza Holocaust  

Gulf War  

Isdood 

Islam  

News  

News Photos  

Opinion Editorials

US Foreign Policy (Dr. El-Najjar's Articles)  

www.aljazeerah.info

 

 

 

Editorial Note: The following news reports are summaries from original sources. They may also include corrections of Arabic names and political terminology. Comments are in parentheses.

 

Oil and Gold Gain on US-Israeli Threats Against Iran and the Iranian Missile-Test Response

 

Oil Gains on Iran's Response to Israel

TEHRAN (FNA)- July 10, 2008

Oil prices finished about where they began Wednesday after jumping more than $2 earlier on an Iranian missile test deemed as a response to intensified threats by the US and Israel as well as reports of lower US oil stockpiles.

Light, sweet crude for August delivery rose a penny to settle at $136.05 a barrel on the New York Mercantile Exchange, but prices shifted between positive and negative territory as traders parsed details of the inventory report following its midmorning release. In aftermarket trading, oil prices fell 40 cents to $135.64 a barrel.

The moves follow two days of steep declines that left prices 6.4 percent below last week's record high.

Figures from the Energy Information Administration showed US oil supplies fell by 5.9 million barrels last week, a decline of 2 percent. That is far above the 1.9 million barrels forecast by analysts surveyed by the energy research firm Platts.

Prices often rise in response considerably to large drops in US oil supplies. But Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates, noted that much of this week's inventory decline was concentrated on the West Coast and was not representative of supplies overall.

"Whenever it's out on the West Coast region, the impact is blunted appreciably," he said.

In addition, gasoline stockpiles rose more than expected, partly offsetting the decline in crude. Inventories of distillate fuel, which include diesel and heating oil, also rose, but less than analysts anticipated.

Retail gasoline prices in the US hovered at a record high just shy of $4.11 a gallon for the third straight day, according to auto club AAA, the Oil Price Information Service and Wright Express. Diesel prices at the pump rose by more than half a penny to a new high of $4.813 a gallon.

Prices rose as high as $138.28 earlier in the day following reports that Iran's Islamic Revolution Guards Corps (IRGC) fired missiles during war games that officials and analysts both said were meant to show that the key oil producer can retaliate against a US or Israeli attack.

The barrage was said to include a new version of the Shahab-3 missile, which officials have said has a range of 1,250 miles. That makes it capable of striking Israel.

Commander of IRGC's Air Force General Hossein Salami said the exercise "is to demonstrate our resolve and might against enemies who in recent weeks have threatened Iran with harsh language."

A day earlier, Iranian President Mahmoud Ahmadinejad dismissed fears that Israel and the United States could be preparing to attack his country, calling the possibility a "funny joke."

Iran is the world's fourth-largest oil producer and OPEC's second-largest exporter. Oil traders fear any military conflict could prompt Iran to block the Strait of Hormuz, a passageway that handles about 40 percent of the world's tanker traffic.

Analysts view geopolitical factors as among the main causes of recent hike in prices, saying that fears of a new Middle East conflict are behind the new high for oil prices.

Market analysts, specially those from consumer nations, take Bush administration responsible for the price hikes in recent months, saying that it is the "rumors of US and Israeli action against Iran circulating in the markets" that affected oil and the dollar.

The declines earlier in the week dragged crude prices back to levels not seen since June 26. However, a number of analysts have cautioned that the sell-off might not represent a long-term shift in the bull ran that just last week drove prices past $145 a barrel.

In Washington, House Speaker Nancy Pelosi called on President Bush to open up the country's Strategic Petroleum Reserve in an effort to bring down prices she said "are helping push the economy toward recession." Bush repeatedly has rejected calls to use oil from the emergency government stockpile.

In other Nymex trade, heating oil futures fell 3.14 cents to $3.8516 a gallon while gasoline futures lost 1.77 cents to $3.3808 a gallon. Natural gas futures dropped 36.2 cents to $12.006 per 1,000 cubic feet.

August Brent crude rose 15 cents to $136.58 a barrel on the ICE Futures exchange in London.

Gold Extends Gains on US, Israeli Threats against Iran

TEHRAN (FNA)- July 10, 2008

Gold rose further on Thursday as safe-haven buying persisted after intensified threats by the US and Israel made Iran show its resolve and military capabilities by successfully test-firing long- and medium-range missiles.

Gold has bounced more than 8 percent since falling to a six-week low of $856.80 an ounce in mid-June. Dealers saw buying from India, but gains may be capped as the missile tests conducted by OPEC member Iran had not caused a surge in oil as claimed earlier by western media.

"There are a lot of uncertainties but I think it still has the potential to go up in the longer term," said Beh Hsia Wah, a dealer at United Overseas Bank in Singapore.

Gold firmed to $927.20/928.20 an ounce from $926.90/928.10 an ounce late in New York on Wednesday, having earlier hit a high of $930.55 an ounce.

Iran test-fired nine missiles on Wednesday and warned the United States and Israel it was ready to retaliate for any attack over its peaceful nuclear projects.

US Secretary of State Condoleezza Rice said on Thursday the United States wants to send a message to Iran that it will defend it allies from possible attack.

"Basically, we saw some bids in the market but it's not that active. Rangewise, maybe we will try a little higher again today," said Ellison Chu, senior manager at Standard Bank London in Hong Kong. "Maybe we will try $935-$936," he said.

Geopolitical tension lifts gold's safe-haven appeal in times of uncertainty. Gold also benefits from rising energy costs due to its role as a hedge against inflation, while a struggling dollar makes bullion an attractive alternative investment.

Oil CLc1 was steady at $136.09 a barrel, having settled slightly higher after a US government report showed a big drawdown in nationwide crude inventories.
The euro eased to $1.5723.

"Having broken above $925, (gold) now targets $936 and the key level of $946," said Investec Australia, adding that it expected volatility ahead as investors reassess their views in the second half of 2008 and beyond after recent losses in commodities markets.

Gold's gains lifted silver, while platinum saw bargain hunting after fears that a slowing US economy could weaken demand from automakers dragged down the price to a two-month low this week.

Silver edged up to $18.10/18.15 an ounce from $18.09/18.15 late in New York.
Spot platinum rose to $1,965.00/1,985.00 an ounce from $1,958.50/1,978.50 late in New York. Spot palladium firmed to $443.00/451.00 an ounce from $442.00/450.00 an ounce.

Gold futures for August delivery on the COMEX division of the New York Mercantile Exchange added $0.1 an ounce to $928.7.

The most active Tokyo platinum contract for June 2009 delivery on the Tokyo Commodity Exchange rose 36 yen per gram to 6,720 yen, having settled 1.3 percent lower on Wednesday.




Fair Use Notice

This site contains copyrighted material the use of which has not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission from the copyright owner.

 

 

 

 

Opinions expressed in various sections are the sole responsibility of their authors and they may not represent ccun.org.

editor@ccun.org