AFP: Oil Gains Despite European Banking Worries; Gold Dips on Profit-Taking
Oil prices are up in early morning trade, despite worries about Europe's financial stability in particular. Crude is gaining momentum following an improvement in the U.S. jobs market, as weekly jobless claims fell by 27,000 to 451,000. Crude also is trending higher as China raised imports of oil by 10% in August from the previous month.
Gold, meanwhile, is down a tad on profit-taking, but continued concerns about longer-term prospects for the global economy is likely to give it firm support. Bangladesh bought 10 metric tons of bullion from the IMF. Market eyes are focused on the weekend meeting of European finance ministers to finalize capital rules. Speculation of a 9 billion euro capital increase by Deutsche Bank in particular is raising market concerns about the European banking sector in general.
At 0805 ET, Brent crude is up nearly 2% at $75.70 a barrel, while light sweet crude is up 1.8% at $75.60 a barrel, and natural gas is up 1.2% at $3.81 a million British thermal units.
Gold is down 0.1% at $1,249.10 an ounce, while silver is up 0.3% at $19/91 an ounce, and copper is down 0.4% to $3.42 a pound.
Concern is growing about the fire started due to a gas line explosion operated by Pacific Gas & Electric Co near San Francisco. The privately held company has about 4.3 million natural gas distribution customers as well as 5.1 million electricity users.
Enbridge Energy Partners LP ( EEP ), meanwhile, is up 0.5% before the bell on the NYSE as it shut down and isolated a pipeline running between Canada and the United States due to a leak. The line carries over one-third of crude imports into the Midwest region.
CNOOC Ltd ( CEO ) plans to start building a liquified natural gas receiving terminal in Hainan by March 2011 to supply gas from early 2014, four years later than previously scheduled, according to local media reports.
SunPower Corp ( SPWRA ) will research large-scale storage technologies in an effort to make renewable energy more widespread.
In the mining sector, Allied Gold Ltd (ALD) said its gold reserves increased 155% to 2.15 million ounces at its wholly-owned Simberi gold project in Papua New Guinea.
