COMMODITIES-Oil up on US fiscal deal promise; rest mostly down

Tue Dec 18, 2012 4:00pm EST

* Brent crude ends up 1 pct as fiscal deal appears closer
    * Gold falls 1.6 pct, touching August lows; copper also down
    * Soybeans tumble 2 pct as China cancels US supplies
    * Higher oil, gasoline prices tip CRB into positive zone

    By Barani Krishnan
    Dec 18 (Reuters) - Oil rallied on Tuesday on growing
optimism that a fiscal deal would be reached soon to avert a
U.S. recession in 2013, but most other commodities, particularly
agricultural markets, closed lower on poorer demand.
    Soybeans slid their most in a month after China, the world's
top buyer of the oilseed, unexpectedly canceled a purchase of
300,000 tonnes of U.S. supplies.
    Arabica coffee resumed its decline as speculators turned
bearish again on a market just rebounded earlier this week from
2-year lows. 
    News of progress in talks to resolve the U.S. budget crisis
did little for metals such as copper and gold.
    Copper settled down 0.3 percent in New York and 0.5
percent in London, with traders saying any deal to avert
the so-called U.S. "fiscal cliff" was probably already priced
into the metal. Copper has gained 6 percent since mid-November,
while oil and gold prices have largely fallen. 
    Bullion's spot price fell 1.6 percent in Tuesday's
session alone, pushing the market to a 3-1/2 month low and
bringing losses since mid-November to nearly 3 percent. 
    Gold sold off even though the dollar slid to a 7-1/2 month
low against the euro, which normally would boost gold and
other commodities priced in the U.S. currency. 
    Traders said a budget deal between the White House and
Republicans in Congress will probably dilute gold's premium as a
safe-haven investment. A deal is needed to avert $600 billion in
tax hikes and spending cuts in January -- a scenario that
economists warn could tip the United States back into recession.
    Top House Republican John Boehner has pledged to press
forward on budget negotiations with President Obama, even though
many in his party oppose his concession last week to consider
higher tax rates on wealthy Americans. 
    In oil, benchmark Brent's front-month contract in London
 closed up $1.20, or 1.1 percent, at $108.84 a barrel.  
    U.S. crude in New York gained 73 cents, or 0.8
percent, to settle at $87.93.
    Gasoline and heating oil futures in New York
both gained more than 1 percent.
     "Everything is keying on the 'cliff' hopes, because people
are assessing if we're closer to a deal," said Mark Waggoner,
president at Excel Futures Inc and an oil market commentator.
    The rise in oil and gasoline prices helped edge the Thomson
Reuters-Jefferies CRB index -- a commodities indicator
largely made up of energy markets - into positive territory.
    The CRB settled up 0.02 percent although 10 of the 19
markets it tracks ended lower. Silver and soybeans showed the
largest loss of about 2 percent each.
    Soybeans' front-month January contract in Chicago 
settled down 30-1/4 cents at $14.66 a bushel after news that
China had canceled the U.S. soy cargoes.
    The Chinese action signaled that demand for U.S. soybeans
were possibly cooling after a robust pace of buying, and ahead
of the harvest of the South American soy crop which was to start
soon, analysts said.
    Aside from the 300,000 tonnes of U.S. supplies dropped by
China, the U.S. Department of Agriculture said some 120,000
tonnes of home grown soy to unknown destinations were also
canceled. 
 Prices at 3:27 p.m. EST (2027 GMT)      
                             LAST/      NET    PCT     YTD
                             CLOSE      CHG    CHG     CHG
 US crude                    87.96     0.76   0.9%  -11.0%
 Brent crude                108.85     1.21   1.1%    1.4%
 Natural gas                 3.418    0.060   1.8%   14.4%
 
 US gold                   1670.70   -27.50  -1.6%    6.6%
 Gold                      1669.30   -28.35  -1.7%    6.7%
 US Copper                  363.65    -1.25  -0.3%    5.8%
 LME Copper                8024.00   -39.00  -0.5%    5.6%
 Dollar                     79.337   -0.231  -0.3%   -1.0%
 
 
 US corn                    720.00    -4.00  -0.6%   11.4%
 US soybeans               1466.00   -30.25  -2.0%   22.3%
 US wheat                   811.25     3.25   0.4%   24.3%
 
 US Coffee                  144.00    -1.95  -1.3%  -36.9%
 US Cocoa                  2397.00   -28.00  -1.2%   13.7%
 US Sugar                    19.39    -0.02  -0.1%  -16.5%
 
 US silver                  31.669   -0.611  -1.9%   13.4%
 US platinum               1593.70   -14.80  -0.9%   13.4%
 US palladium               690.95    -7.35  -1.1%    5.3%
A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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