November 23, 2009

Gold up $18 in New York after gain to new record

by Elaine Frei

Gold hit $1,174 per troy ounce in morning trade in New York before December contracts fell back but still added $18 on the session to $1,164.80 per troy ounce on another decline for the US dollar.

The greenback was hurt by remarks this weekend from the president of the St. Louis Fed made it look like interest rates will stay low in the US for longer than some had assumed, as well as by tensions between Iran and some Western governments as Iran conducted war games that seemed aimed at showing its ability to defend its nuclear sites.

Among other precious metals, December silver was up 17 cents to $18.61 per troy ounce while January platinum was $25.70 higher to $1,467.60 per troy ounce, while in earlier trade December palladium followed platinum higher to gain $10.10 to $374.45 at mid-morning.

Among base metals, March copper was 3 cents higher to $3.16 per pound in New York trade.

The price of oil was down slightly Monday afternoon in New York after rising to nearly $80 per barrel earlier in the session following a new report from the National Association of Realtors which said that sales of previously owned homes was up 10.1 percent last month to its highest level in over two years, raising hopes that demand for oil and oil products will recover soon

With just a few minutes left before the close of floor trade on the New York Mercantile Exchange, December contracts for West Texas Intermediate crude was down 10 cents to $77.37 per barrel, although at last report January Brent crude contracts were up 41 cents to $77.61 per barrel on the ICE Futures Europe exchange in London.

In afternoon trade, Nymex December gasoline futures were up 2 cents to $2.00 per gallon while January heating oil added a cent to $2.02 per gallon and January natural gas had gained 6 cents to $4.82 per million British thermal units.

Despite hopes, demand remains below last year at this time even though AAA expects 2.1 percent more American will drive more than 50 miles from home over the upcoming Thanksgiving weekend and another refiner announced Friday, that it was shutting down a refinery because it costs too much to buy oil to refine and demand for gasoline remains below last year’s levels.

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