Oil Prices Rank the Highest in One Year, the Gold in Seven Years

As Iraq again becomes an actual war state, the prices of international raw materials such as crude oil, gold, beans, and natural rubber are skyrocketing.

Funds which prefer safe investment targets are flowing into the gold market and the international gold price has risen to its highest level in seven years. Oil prices are increasing everyday from the full scale reduction OPEC (Organization of Petroleum Exporting Countries) is carrying out and from the setback of Iraq oil exportation due to the confusion of the Iraq situation,

At the New York Mercantile Exchange (NYMEX), on November 12, the advance price (December shares) of West Texas Intermediate (WTI) was $31.33 per barrel, increasing by $0.18 from the day before, and rising to its highest level in a year. After the fact that U.S. Lt. Gen. John Abizaid had said “Iraq is in an actual war state” was reported, the Middle East Dubai oil price showed an increase.

Market officials judge that the high oil prices will continue for the time being, because petroleum demands will increase with winter coming, and the OPEC has started a full scale reduction since October.

Gold was traded at $387 (spot price) per ounce at the London market on November 11, and rose to its highest level in seven years, and following, at the New York market, on November 12, the advance price of December’s shares rose $6.80 since the day before, trading at $395 per ounce.

Bean prices at Chicago’s grain market rose to its highest level in six years due to the increasing demands from China and a worldwide poor harvest, and the natural rubber rose to it highest in seven years in Singapore’s markets.

Japan’s Yomiuri newspaper, using the quotes of international finance experts, reported, “As the dollar weakening continues and profitability in stock markets slump, international speculative funds are flowing into the commodity market.”

parkwj@donga.com