Oil Report

Tokyo rubber drops to 5-week low after oil slides

TOKYO, July 16 (Reuters) - Tokyo rubber fell almost 3 percent to a five-week low as investors sold to limit losses on Wednesday after a huge fallback in oil prices.

* The key Tokyo Commodity Exchange rubber contract for December delivery <0#JRU:> was down 9.4 yen or 2.8 percent at 329.0 yen a kg. It earlier fell as low as 326.7 yen, the lowest intraday price for any benchmark since June 5.

* “The market took a hit as sellers joined the band wagon,” said Kaname Gokon, deputy general manager at Okato Shoji Co’s research section. “I think the market’s range has now leveled down to 325-333 yen.”

* U.S. crude oil futures dropped more than $6 per barrel on Tuesday, the largest drop in dollar terms in 17 years, as growing concern about the economic health of the world’s top energy consumer, the United States, stirred demand worries. [O/R]

* U.S. crude CLc1 was up 13 cents at $138.87 a barrel on the Globex electronic trading platform on Wednesday, leveling off after tumbling $6.44 to $138.74 on Thursday.

* Dealers said this week that Chinese consumers and tyre makers are in the market to buy more rubber, which should provide support for cash prices when supplies start to pick up in Southeast Asia. [ID:nSP201602] (Reporting by Risa Maeda; Editing by Hugh Lawson)