Commodities: Energy futures hit by Iraqi, Russian doubts

Energy futures came under significant selling pressure at the start of the week amid reports that Iraq and Russia might be hesitant to curtail their own production following talks at the weekend between Gulf producers and Russia.

Acting as a backdrop, as of 1751 BST the US dollar spot index was edging higher by 0.11% to 98.78, while Bloomberg's commodity index was losing 0.34% to 85.81.

Speaking on Sunday, Iraqi oil minister Jabber Al-Luaibi said his country was currently pumping over 4.7m barrels a day of oil and not the 4.2m b/d which OPEC had recently estimated.

“We are with OPEC policy and OPEC unity, but this should not be at our expense,” Al-Luaibi said.

In parallel, following talks with Gulf Arab representatives, in Riyadh, on Sunday, Russian energy minister Alexander Novak said his country could not yet say whether it will participate in any reductions and that it was studying various scenarios.

Weighing on crude oil futures as well were rising odds of a Fed interest rate hike in December, with Fed Funds futures pricing in a 74.5% chance of a December hike in afternoon trading.

On the back of all of the above, front month West Texas Intermediate was down by 2.14% to $49.76 a barrel on the ICE, but the biggest loser were November 2016 natural gas futures, which were retreating by 4.21% to $2.87/MMBtu.

COMEX traded gold futures for delivery in December 2016 were alos to be seen lower, slipping 0.32% to $1,263.60/oz..

Similarly-dated silver futures on the other hand rose 0.50% to $17.58/oz..

Soft commodities were also generally lower, with the CBoT December 2016 wheat futures contract losing 3.14% to $4.0150 a bushel, while CME-traded live cattle gained 2.72% to $1.0465 a pound.